Investment Real Estate

Loading the player...

What is 'Investment Real Estate'

Investment real estate is real estate that generates income or is otherwise intended for investment purposes rather than as a primary residence. It is common for investors to own multiple pieces of real estate, one of which serves as a primary residence, while the others are used to generate rental income and profits through price appreciation. The tax implications for investment real estate are often different than those for residential real estate.

BREAKING DOWN 'Investment Real Estate'

Common examples of investment properties are apartment buildings and rental houses, in which the owners do not live in the residential units, but use them to generate ongoing rental income from tenants. Those who invest in real estate also expect to generate capital gains as property values increase over time.

RELATED TERMS
  1. Real Estate

    Land plus anything on it, including buildings and natural resources.
  2. Private Equity Real Estate

    A Definition of "Private Equity Real Estate" and how it applies ...
  3. Commercial Real Estate

    Property that is used solely for business purposes. Examples ...
  4. Rental Real Estate Loss Allowance

    A federal tax deduction of up to $25,000 that is available to ...
  5. Real Estate Investment Group

    An organization that builds or buys a group of properties and ...
  6. Real Estate Agent

    A person with a state/provincial license to represent a buyer ...
Related Articles
  1. Investing Basics

    Understanding Real Estate

    Real estate is an encompassing term that refers to land, the buildings on that land, and its natural resources, such as crops and minerals.
  2. Home & Auto

    4 Ways To Value A Real Estate Rental Property

    Learning these concepts is the first step in getting into the real estate investment game.
  3. Mutual Funds & ETFs

    The Risks Of Real Estate Sector Funds

    Discover the risks and rewards of investing in real estate funds, as well as some of the best and worst performers.
  4. Home & Auto

    3 Tips For Buying Investment Properties

    Real estate can be a highly effective wealth building tool. Learn how to increase your chances of success.
  5. Home & Auto

    Exploring Real Estate Investments

    Discover how owning properties can give you a roof over your head or a check in your pocket.
  6. Home & Auto

    Flipping Houses: Is It Better Than Buy and Hold?

    Real estate investors can flip a property or use it for cash flow. Find out which will work in your neck of the woods.
  7. Real Estate

    Simple Ways to Invest in Real Estate

    Owning property isn't always easy, but there are plenty of perks. Here are some ways to invest in real estate.
  8. Investing Basics

    4 Key Factors That Drive The Real Estate Market

    The size of the real estate market make it an attractive sector for many investors, but understanding the factors that drive it is essential.
  9. Home & Auto

    Exploring Real Estate Investments: Introduction

    By Ian Woychuk, CFA Chances are, when you think about investing in real estate the first thing that comes to mind is your home. For many people, their home is the single largest investment they ...
  10. Home & Auto

    3 Reasons to Invest in Multi-family Real Estate

    Here are three reasons to consider investing in multi-family real estate as opposed to single unit rental properties.
RELATED FAQS
  1. Why can real estate be a good addition to a traditional stock and bond portfolio?

    Discover why real estate can be a good addition to a traditional stock and bond portfolio. Real estate is affected by economic ... Read Answer >>
  2. What does asset management mean in regards to real estate?

    Find out what role asset managers play in the real estate markets, how real estate portfolios are selected and why entrepreneurial ... Read Answer >>
  3. Can real estate be depreciated?

    Decrease the amount of taxable income on your income-producing real estate by depreciating the asset on your federal income ... Read Answer >>
  4. How much of an institutional pension fund's portfolio is typically investing in real ...

    Learn what percentage of assets institutional pensions typically allocate to real estate investments. Read Answer >>
  5. What factors drive share prices in the real estate sector?

    Discover the main factors that tend to drive share prices in the real estate sector and some equity evaluation metrics specific ... Read Answer >>
  6. How does the risk of investing in the real estate sector compare to the broader market?

    Learn about the high volatility of the real estate sector and how conservative investors gravitate toward real estate investment ... Read Answer >>
Hot Definitions
  1. MACD Technical Indicator

    Moving Average Convergence Divergence (or MACD) is a trend-following momentum indicator that shows the relationship between ...
  2. Over-The-Counter - OTC

    Over-The-Counter (or OTC) is a security traded in some context other than on a formal exchange such as the NYSE, TSX, AMEX, ...
  3. Quarter - Q1, Q2, Q3, Q4

    A three-month period on a financial calendar that acts as a basis for the reporting of earnings and the paying of dividends.
  4. Weighted Average Cost Of Capital - WACC

    Weighted average cost of capital (WACC) is a calculation of a firm's cost of capital in which each category of capital is ...
  5. Basis Point (BPS)

    A unit that is equal to 1/100th of 1%, and is used to denote the change in a financial instrument. The basis point is commonly ...
  6. Sharing Economy

    An economic model in which individuals are able to borrow or rent assets owned by someone else.
Trading Center