Types Of Real Estate Investors.
The most important feature with which we can distinguish Real Estate Investors is their investment motive. All Investors buy Real Estate, However, not all of them do for the same reasons. Let’s have a look at the major categories of investors in the market.
Individual Investors: Most of the investors in the Real Estate market are individual investors. Individual Investors have an unlimited liability. This means that if they undertake a mortgage on one house band default on it, their other assets can be liquidated to make good the loss.
Institutional Investor: There are many institutional investors in the Real Estate market as well. These institutions usually finance themselves by issuing long term bonds in the bond markets. Since these bonds have a secondary market, they are very liquid and provide the investors with the ability to enter and exit the real estate market without any major hassles.
While, in terms of number, individual real estate investors may outnumber the institutional investors, in terms of scale or volume, they are no match for the big corporations who invest billions of dollars in Real Estate Investments.
Real Estate market, like the other markets, is somewhat dynamic. It has various investor groups, who have different motives and based on the competition and co-operation between them, the Real Estate prices are determined, to achieve best returns for the stakeholders.