Real estate formal report

Real estate formal report

Executive summary

This report is purposely meant to analyze real estate investment as a major field of study. At first, this report discusses on the state of real estate investment broadly in its method of operation. Real estate is an industry reacting to the trends such as population growth and economic strengths. Apart from changing of prices, real estate is providing to entrepreneurs great opportunities for investments. Companies in real estate purchase rent, buy real estate and are involved in leasing public property. In addition, major companies such as Host and Hostel reports among others are discussed that constitute real estate are also discussed in detail. On top of that, the report outlines clear some of the job opportunities that tied to the real investment career.

The report has significantly narrowed down to include the possible remuneration rights pertaining the real estate investment. This is meant to motivate all the learners in the field of real estate investment to confidently perfume in the field with a promise of good wages and salaries at the end of the course. There are a number of challenges behind overall management of real estate. Quality control and relevance both caused by real estate overcrowding is one of the major challenges associated with the management of real estate. Real estate is not just an ordinary field to freestyle, instead, special education and technical training are required in order to thrive in the field of real estate investment. Techniques, methods and procedures to taking the line of real estate investment are broadly discussed in the report. Like in other fields, misconceptions behind the field of real estate are openly reveal in the report.

State of the real estate industry

Basically, real estate is categorized into residential and commercial real estate services.  However, some management companies and brokerages base their concern both divisions. Residential and commercial segments are quite fragmented.  In each of the Category, there are fifty larges companies that make up almost 30% of the total industries’ total revenue.

Residential real estate

This category of real estate is specialized in providing valuation and in inspecting products for lenders, mortgage backed portfolio managers, loan servicing and lastly default service providers. The knowledgeable networked real estate valuation professionals enhances a high quality property valuation services and pre and post foreclosure inspections for property condition revivification (Ding, 2014). Real estate industry keeps on improving with introduction of new methods and technicalities of operation. For instance, in the year 2003, RRR was set to bring about BPO products to the mortgage servicing industry. Ding stipulates that, RRR today provides valuation services to more than 200 clients in all 50 states.

Commercial real estate

In commercial real estates, transactions are complex, high risks involved and again it deals with large sums of money (McMahan, 2006). The money may be inform of dollars but substantial. Another special characteristic of real estate is that the transactions involve heavy tax rates as compared to residential real estate. The property in question is thoroughly reviewed before execution regardless of the nature of transaction may it be selling, conveying or buying. However, when doing a legal review, the PC general can reduce the likelihood of any dispute likely to occur.

Real estate risks

1. It is often faced my macroeconomic factors such as downturns in a countries economy.
2. there is a possible change especially when one has bought property, the value can raise or fall in value
3. Increased supply associated with selling or buying of property can render the prices lower. This has an effect of loss.
4. There is a possibility of changing property specification and requirements especially for old buildings and this can probably result to losses.

Real estate industry opportunity

Promotions concerning selling of real estate property has extended to include online markets where all the participants and online brokers are using real estates in marketing their property (Glascock & Lu-Andrews, 2014). Significantly, better potential purchaser of real estate if persuasive can easily fasted selling cycles only if they are aware of what they do and want. Most of the people are afraid that online selling may lead to exhaustion of brokers but sin real sense is business is conducted in a way not to exclude, anybody from the market. In addition, there are skills and techniques behind marketing of the real estate property.

The essence of online opportunity of real estate is that more sales are realized as compared to a situation where brokers are included directly. One of the advantages of real estates is that owners of homes cannot detect the best times when to sell their property not unless through online advertisements and news about prevailing real estate selling value. According to Glascock & Lu-Andrews (2014) , the online real estate industry opportunities contributes greatly to the selling, buying and conveying o the property in need.

Real estate agents

Most of the people may be anticipating for buying large and expensive building at the expense of venturing in homeowners that are incredibly disconcerting. However, the real estate best operations and agents will possibly run for the homeowners. The wise and successful real estate agents always aims at enjoying both the services accrued at client’s level and those that are accrued at financial level of the industry.

Basically, the work of the real estate agents is to sell and buy homes on the behalf of their clients and therefore they should so wise in order to offer to their clients wise decisions when to lease or rent a property or even the best time when to sell or buy new homes. These decisions are made on the bases of the prevailing prices of a real estate property in the market (Ding, 2014). In addition, the agents also advise their clients on the best homes they should buy depending on their specifications or the price accompanies their current conditions. The difference between real estate brokers and real estate agents is that brokers are licensed to perform their activities while the agents are not, instead, they do operate under the clients.  Commonly, the agents and brokers help the clients in purchasing homes.

Salary

The reviews by the BLS asserts that the real estate agents earned $40,990 in 2014. However, the best paid real estate agent is $105 220 while ‘the least paid real estate industry agent is approximately $ 21240 (Glascock & Lu-Andrews, 2014). Among the area known for paying real estate agents are, Nevada, Reno New York and the Metropolitan areas.

Job Satisfaction

Real estate industry is a fulfilling career that is enjoyable and fulfilling. Generally, Americans work best at their 60s and therefore real estate field is best for providing jobs at that area (Ding, 2014). In real estate job’s satisfaction, high mobility is rated above average, stress level average and finally flexibility is rated above average.

Training and education

Study of real estate industry requires a lot of training and teachings which will enable understanding of the section in the field of business (Fein & Merritt, 2014). Through the training which have been realized in this field of business study is that the minimal level of education in which real estate require is normally high school diploma level. Most of the states requires for about 30 up to 90 hours’ time for receiving of classroom instructions for real estate (Fein & Merritt, 2014). The experts in the business are required to be holding a bachelor degree in the process of building up the advancement level of foundation. The instructions are mostly given at community level colleges local and real estate association trades. The trainings are mostly offered through online sources which give out the accredited programs which are required to be licensed. In the process of perusing the education for the development of the professionals based on the fact that the real estate requires less of the sales agents (Fein & Merritt, 2014).

Training and teaching of real estate brokers

For a broker to fit in this field of real estate, s/he should be have great qualifications in this field which direct results from formal education for 30-90 hours of training which are recommended period of which was set and found to be better for a certain person to be able to become well skilled with required skills in this field of real estate study (Ling & Archer, 2012). The courses concerning the real estate are proved to be very important in the process of understanding what is real required for the acknowledgement of different fields in real estate.

Challenges facing real estate industry

There are some challenges which face real estate industries through analysis of different areas under which real estate falls into. The papers will analysis few areas which are faced by some challenges in this field of real estate industries (Ling & Archer, 2012). There have lack of appropriate policies based on housing development which most of time it has contributed too much of housing overcrowding and poor conditions since there are no established policies under which the set houses will be arranged in terms of construction and establishment. There is another which has been facing the process of acquiring the plots for construction, the title of the land, the permit for construction credit facilities for housing and operation of stake holders for housing development within the country (Ling & Archer, 2012). The process of getting the permits mostly becomes very long process of operation. Through the prolonging of the process, the cost increases and tiresome to the person who is undergoing the process.

Methods and techniques in real estate industry

There are different area to focus on in the process of dealing with techniques and methods in real estate approach. The methods of approach are discussed below (Ling & Archer, 2012).

Real estate investment trusts

The shares in the real investment trusts commonly known as REITs have for the past seven years been very attractive to investors. This translates into the fact that majority of the investors who are chasing incomes are likely to suffer painful losses due to the downfall of the commercial property business (Ling & Archer, 2012).

The cycle turns

The REITs have accumulated huge portfolios of commercial property like offices and shopping centers with a list of shares on the industry stock exchange market which creates the necessary and required exposure in the real estate sector. The property has been very attractive to investors especially the overseas ones. However, several issues undermine these well-established cycles leading to the overall downfall of the London’s commercial property especially after 2009 (Ling & Archer, 2012). These factors like the rising level of competition in the outside and overseas bodies have greatly affected the commercial property sector in real estate industry.

Calling the top

The managing director at Broker Jefferies who is a real estate specialist and expert has been in the limelight after his calling to the top of the market says that the drying demand in the commercial property sector is a major factor leading to the downfall of the industry. As a result, the listed REITs had their success wings pulled down as investors try to get their money from the sector in advent for greener pastures (Yan & Lang, 2013). This has been occurring at a very alarming rate since the year 2008 leading to the reduced level of success in the sector.

Misconceptions in real estate industry

Investing indirect may take the form of real estate invest trust, mortgage-backed commerce and derivative properties. The “REITs” is new form of public equity property concerned with real estate investment (Yan & Lang, 2013). The investors require some securities for the loan that they take from the banks hence taking an advantage of property pools as security hence benefit a lot in this field of business. In the process of investing the payment of taxes in real estate market, we find that it is a kind of set policy concerning all the businesses over the world. The tax some time may go so high in such a way that the rate at which one gain from the commercial business is too low but this varies with different seasons of the year within those industries (Yan & Lang, 2013). There are high chances of direct investment simply because the cost incurred during the process is somehow low as compared to complex processes which are supposed to be passed during the indirect investment in commercial property real estate (Yan & Lang, 2013).

Conclusion

Real estate business is highly threatened and there is likelihood of price fall in most of the companies of industries dealing with property. The prices are highly over valued than any other cities in the world (Yan & Lang, 2013).  The foreign investments   which are referred to as help-to-buy scheme or the international investors and the rapid population growth, have made the prices of the property to shoot in the city and therefore, there could be case of substantial  prices and corrections especially when the investment conditions keeps to deteriorate (Yan & Lang, 2013).

References

Ding, L. (2014). A study on relation of corporate social responsibility and corporate financial        performance or corporate value: Empirical evidence from listed real estate companies.         International Journal of Business and Social Science, 5(8).

Fein, G. S., & Merritt, E. A. (2014). U.S. Patent No. 8,694,519. Washington, DC: U.S. Patent      and Trademark Office.

Glascock, J. L., & Lu-Andrews, R. (2014). The profitability premium in real estate investment      trusts. Available at SSRN 2375431.

Ling, D., & Archer, W. (2012). Real estate principles: A value approach. McGraw-Hill Higher      Education.

McMahan, J. (2006). The handbook of commercial real estate investing. New York, NY: McGraw-          Hill.

Yan, S., & Lang, C. T. (2013). Influencing Factors Evaluation of the Real Estate Prices Based on             the Factor Analysis. Journal of Jilin Institute of Architecture & Civil Engineering, 2, 016.