Are you looking to become a real estate investor in 2014 or are you looking to put your property on market? Before entering into any such domain, do your homework and gather all the necessary information. It helps to start from knowing about the different types of properties. There are five basic types to consider: residential, commercial, industrial, agricultural, and special-purpose. Let us look at the description of each of these:
Residential PropertyThis is the property type with which most buyers or sellers deal with. Under its banner comes the property that serves as a dwelling or a home of any kind. For example, it can be a house, a multi-family home or a duplex in the city suburban or rural areas. In certain situations properties originally constructed as residential properties are converted in to commercial ones. For example, homes or apartment complexes above a certain size are viewed as commercial by the government. These types of properties are then scrutinized by the loan lender and are often considered ineligible for home loans.
Commercial PropertyA home buyer does not often deals with commercial real estate; however, everyone is familiar with commercial properties as they come across the same in their daily lives. A commercial property is one where business or commerce takes place like parking facilities, malls, stores, shops, hotels, entertainment venues, or any form of market. Commercial property has a different set of criteria for the buyers as it involves businesses zoning, taxes, permissions, and other official formalities. Entrepreneurs and investors often consider commercial properties and would have knowledge or ideas on how to expand on the value of existing properties. There are certain companies that buy homes and convert them into commercial properties like guest houses and shops later.
Industrial PropertyIndustrial property can be confused with commercial property because both have commercial use. In fact, as long as a property follows industrial property rules such as zoning codes, a commercial property can be used in an industrial area. However, industrial property itself is set apart to include factories, warehouses, power plants, and other high utility buildings. The goods are manufactured or supplied in industrial properties. Therefore, all the buildings used as warehouses (godowns), garages, manufacturing and distribution centers are tagged as industries. Such industrial real estate buildings are often big in areas and are situated in secluded and not so central points. For example, in Delhi most of the industries are grouped together and are situated on the outskirts. An industry area should be bought keeping in consideration that it should be well equipped with the facilities like water and electricity and should be away from residential colonies so that it does not disturb the residents.
Agricultural PropertyAgricultural property is pretty simple to designate and understand conceptually. It is land that is primarily used for agricultural purposes. The property includes farms and ranches. A specific agricultural knowledge is necessary while purchasing this type of land. One should be sure about the products or livestock that can be grown and accommodated in the area. Even if something was grown on a particular land in the past, the buyer should check for the depletion of nutrients prior to the purchase.
Special PurposeMost people don't deal with special purpose properties. A special purpose property can be defined as a property that is appropriate for one use or limited use. Some examples of special use property include the places of worship, schools, government held lands, and cemeteries.
MakaanIQ hopes that the article helped to illustrate the differences between the major types of properties. Make sure that you are appropriately knowledgeable about the type of property that you are considering to purchase.
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