Property Investment
Definition of Property Investment
Property investment is any real property owned and used for a source of income or capital growth potential. It involves the purchase, management, rental and sale of real estate property for profit making. It is property used for investment purposes rather than for residence.
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Land Investment
Land investment is the purchase and sale of land for profit. Any property without man made buildings is referred to as land and the title can include rights to natural resources such as water and minerals.
With increasing populations land investment can produce large profit gains in both the short and long term. Analysis for both current and emerging market trends and development is crucial in land investment.
Property Development
Property development is a broad term encompassing many activities like the purchase of land and further construction before resale to the renovation and resale of existing property. Property development involves research, selection, design, financing, construction, management, operations and sale aspects. A beginning to end process, developers can be separated into either land or building developers.
Pre-Constrution Projects
Pre-construction projects deal with any form of work done on raw land prior to construction. Relating to land developers it is the acquisition of undeveloped land which is then further improved with:
- Legal permissions such as covenants (zone and building permissions)
- Utility connection (gas, water, electricity)
- Physical work on the land such as roading and grading.
Lease
A written contract between a landlord (lessor) and a tenant (lessee) for the rental and temporary possession of a property in exchange for monetary payment. Usually for a fixed time period, can be classed into net or gross leases and are subject to various circumstances by both parties.
Rent
A contract or written rental agreement between a landlord and a tenant for the purpose of a residence to occupy. The contract terms are managed and regulated under contract law. A temporary payment is made from the tenant to the landlord for the privilege of living in a property.
Commercial Property
Commercial property is real estate that is purposely zoned as income producing. It includes office buildings, warehousing and industrial plants, restaurants, hotels and retail buildings. Income is received through rent and capital gains on appreciation when a sale occurs. Commercial property is often high risk due to low demand, location and non-payment by tenants.
Residential Property
A residential property is real estate in an area in which housing has been developed purposely as a dwelling. Residential property is subject to zoning and council law including:
- Inner city residential
- Inner mixed zone
- Rural residential
- Existing residential
- New development
- Urban fringe
Residential property differs from commercial due to specific zoning, depreciation and taxation, use and is usually subjected to certain areas.
Holiday Property
Usually property abroad from an investor’s country of residence, Holiday property has increased rapidly following the expansion of the European Union and development of prime land in tropical countries.
Although subject to a counties laws and taxation, holiday and luxury property can provide high capital gains if purchased in emerging markets. Market analysis is the key in this instance with an investor understanding all the viable conditions.
Companies such as www.holiday-rentals.co.uk make it easy for an investor to rent holiday property.
Luxury Rentals
Luxury rentals have become increasingly popular in the current market and come in many forms.
With property in the form of luxury housing, golf courses, beaches, historic estates, and islands in real-estate, to both motor and sailing yacht, prestige vehicle, and plane and helicopter rental as other luxury assets.