Real estate

Real estate or immovable property is a legal term (in some jurisdictions) that encompasses land along with anything permanently affixed to the land, such as buildings. Real estate (immovable property) is often considered synonymous with real property (also sometimes called realty), in contrast with personal property (also sometimes called chattel or personalty). However, for technical purposes, some people prefer to distinguish real estate, referring to the land and fixtures themselves, from real property, referring to ownership rights over real estate. The terms real estate and real property are used primarily in common law, while civil law jurisdictions refer instead to immovable property. Property law, the area of the common law that governs real property, differs from contract law in that it focuses primarily on rights that one person holds over all other people, as opposed to specific individuals.

In recent years, many economists have recognized that the lack of effective real estate laws can be a significant barrier to investment in many developing countries. In most societies, rich or poor, a significant fraction of the total wealth is in the form of land and buildings. In most advanced economies, the main source of capital used by individuals and small companies to purchase and improve land and buildings is mortgages -- bank loans for which the real property itself constitutes collateral. Banks are willing to make such loans at favorable rates in large part because if the borrower does not make payments the lender can foreclose, that is, file a court action that lets them take the property and sell it to get their money back. However, in many developing countries, there is no effective means by which a lender could foreclose, so the mortgage loan industry as such either does not exist at all or is only available to members of privileged social classes.

In spite of the name, the law does not consider real property more genuine or "real" than personal property. In law, the word real means relating to a thing (from Latin res, matter or thing), as distinguished from a person. Thus the law broadly distinguishes between real property (land and anything affixed to it) and personal property (everything else, e.g., clothing, furniture, money). The conceptual difference was between immovable property, which would transfer title along with the land, and movable property, which a person would retain title to. The term is not derived from the notion of land having historically been "royal" property. The word royal — and its Spanish cognate real — come from the unrelated Latin word rex, meaning [[king].

With the development of private property ownership, real estate has become a major area of business. Purchasing real estate requires a significant investment, and each parcel of land has unique characteristics, so the real estate industry has evolved into several distinct fields. The price or value of real estate, although it generally tends to increase over time, is highly volatile and erratic. Cities such as Vancouver, British Columbia and Boise, Idaho have experienced remarkable growth in real estate prices in the new millennium, while other cities have experienced large decreases for a period of 10 or 15 years, such as that of Cleveland, Ohio in the 1980s and 1990s. Specialists are often called on to valuate real estate and facilitate transactions. Some kinds of real estate businesses include:

• Appraisal - Professional valuation services
• Brokerages - Assisting buyers and sellers in transactions
• Development - Improving land for use by adding or replacing buildings
• Property management - Managing a property for its owner(s)
• Real Estate Marketing - Managing the sales side of the property business
• Relocation services - Relocating people or business to different country

Within each field, a business may specialize in a particular type of real estate, such as residential, commercial, or industrial property. In addition, almost all construction business effectively has a connection to real estate.

"Internet Real Estate" is a term coined by the internet investment community relating to the parallel that exists between high quality internet domain names and real-world, prime real estate - both are highly valued claims to something, and they can only be asserted or supported by means of agreement upon a certain code, such as a national legal system or the body governing internet domain names.

Levels

According to The Economist, "developed economies'" assets at the end of 2002 was

• Residential property: $48 trillion
• Commercial property: $14 trillion
• Equities: $20 trillion
• Government bonds: $20 trillion
• Corporate bonds: $13 trillion
• Total: $115 trillion

That makes real estate assets 55% and financial assets 45% of total stocks, bonds, and real estate assets. Assets not counted here are bank deposits, insurance "reserve" assets, and human assets; also it is not clear if all debt and equity investments are counted in the categories equities and bonds. For US asset levels see FRB: Z.1 Release-- Flow of Funds Accounts of the United States.

See also

• Housing bubble
• List of real estate topics
• Real estate pricing
• National Association of Realtors
• Real estate appraisal
• Real estate economics
• Real property

External links

For residential real estate websites, see:

• Template:Yahoo directory
• MSN Real Estate
• Real Estate Resource
• Consumer MLS Access Information
• Template:Dmoz