Absentee Owner

AAA

DEFINITION of 'Absentee Owner'

An individual who owns a piece of real estate but does not live in it. An absentee owner may also be an entity such as a corporation or real estate investment trust (REIT). The real estate held by an absentee owner can range widely - while an individual may own a single condominium or apartment, a corporation may own a large chunk of real estate such as an apartment building or shopping mall. The primary motivation of absentee owners is to generate returns from their real estate holdings in the form of rental income and potential capital appreciation.

INVESTOPEDIA EXPLAINS 'Absentee Owner'

The proportion of absentee owners in the population at large is directly correlated to the degree of real estate speculation prevalent in the economy. A strong property market and economy coupled with relatively low interest rates may result in a higher proportion of absentee owners, while a sluggish market and economy may limit the number of absentee owners.

RELATED TERMS
  1. Owner-Occupant

    A resident of a property who also holds the title to that property. ...
  2. Title

    The right to the ownership and possession of any item that may ...
  3. Landlord

    A real estate owner who rents or leases land or a building to ...
  4. Land Contract

    An agreement between a buyer and seller of property in which ...
  5. Land Lease Option

    An option within a lease contract that grants the lessee the ...
  6. Discounted Payoff

    The repayment of a loan in an amount that is less than the principal ...
Related Articles
  1. Personal Finance

    Real Estate Speculation In College Towns

    Is this an investing option you should consider? Find out here.
  2. Home & Auto

    Condo Complications: The Issues Behind Ownership

    Being a "condo person" is just one of the issues you'll have to examine when deciding if a condo is right for you.
  3. Home & Auto

    An Introduction To Buying A Condominium

    This real estate investment provides unique advantages - and challenges.
  4. Fundamental Analysis

    Why are OTC (over-the-counter) transactions controversial?

    Learn more about over-the-counter transactions, and why OTC traders are considered riskier than traders working with larger market exchanges.
  5. Options & Futures

    What is the difference between arbitrage and hedging?

    Dive into two very important financial concepts: arbitrage and hedging. See how each of these strategies can play a role for savvy investors.
  6. Bonds & Fixed Income

    What is the lowest capitalization rate before an investment becomes unprofitable?

    Learn about different levels of profitability associated with investments featuring similar capitalization rates. Explore how value changes affect rates.
  7. Investing Basics

    How do REIT managers use capitalization rate to configure their portfolios?

    Learn how REIT managers use capitalization rates to help assess risk and identify properties as potential purchase and sale candidates.
  8. Home & Auto

    What is the difference between capitalization rate and rent?

    Find out the difference between capitalization rate and rent and why they are so important to making wise investments.
  9. Investing Basics

    The Strange New World Of The Bitcoin Exchange Futures Market

    We explain the basics of the Bitcoin exchange and futures market.
  10. Investing Basics

    What is the difference between a REIT and a master limited partnership

    While both are prized for their dividends by income investors, there are notable differences between REITs and master limited partnerships (MLPs).

You May Also Like

Hot Definitions
  1. Command Economy

    A system where the government, rather than the free market, determines what goods should be produced, how much should be ...
  2. Prospectus

    A formal legal document, which is required by and filed with the Securities and Exchange Commission, that provides details ...
  3. Treasury Bond - T-Bond

    A marketable, fixed-interest U.S. government debt security with a maturity of more than 10 years. Treasury bonds make interest ...
  4. Weight Of Ice, Snow Or Sleet Insurance

    Financial protection against damage caused to property by winter weather specifically, damage caused if a roof caves in because ...
  5. Weather Insurance

    A type of protection against a financial loss that may be incurred because of rain, snow, storms, wind, fog, undesirable ...
  6. Portfolio Turnover

    A measure of how frequently assets within a fund are bought and sold by the managers. Portfolio turnover is calculated by ...
Trading Center