Types of Investm't Property



Types of Property
Most property in the USA have the important features of a good investment, namely capital growth, regular income, as well as tax advantages, liquidity and control.

The main 4 main categories of property in the USA are:

  1. Residential
  2. Commercial
  3. Land
  4. Other


Range of Property Investments
The range of property investments for direct investing by an investor are:

  • Bare land.
  • Residential property.
  • Flats
  • Industrial (warehouses, factories).
  • Commercial (offices).
  • Retail
  • Hotels or motels.

The more speculative property investments include bare land and residential property. Buying hotels or motels is in effect buying a business and is not regarded as a proper property investment.

Property is often included under the equities asset class, as investors typically buy an equity "share" in a company, whose business is to own property. There are some very important factors to consider when investing in property.


There are 7 Major Types of Property
The 7 major types (apart from Hotels etc) are:

  1. Residential
  2. Apartments and Flats.
  3. Commercial Property.
  4. Industrial Property.
  5. Retail
  6. Hospitality
  7. Rural

Here are the 7 major types of property available for investors.


1. RESIDENTIAL PROPERTY

Residential property is a common, and increasingly popular, form of investment in the US. These days, we all know someone who seems to have a made a bundle out of rental property. But will it continue?

If you are looking to invest in residential property, take time to learn about this type of property as well as how property investment actually works in the US.

As an alternative to investing directly in property, consider avoiding some hassles and minimising some risk by investing indirectly through other investment vehicles, such as unit trusts - property.

Advantages of investing in residential property:

  • Expenses, including depreciation on the property and interest on your borrowings, are tax deductible.
  • You make money as the value of the property increases.
  • You can leverage your investment.
  • You get rental income.
  • For people who can't save, paying off a mortgage is an enforced savings programme.

Risks of investing in residential property:

  • Interest rates could rise.
  • The property could be untenanted for a period of time.
  • You could get "bad" tenants.
  • It could take up a lot of your personal time.
  • House prices could remain static, or even fall.