Real estate industry employs thousands of people and their income is derived from this industry. People get jobs as masons, plumbers, or even carpenters.
According to the Legal Case 1992, real estate refers to the umbrella term for land and improvements done on it such as the erection of buildings, digging of wells, and construction of fences. Largely, the improvements are to be immovable or permanent settlements.
These are the two ways:
There are several roles that the real estate industry does to the economic field. These areas are explained below:
The real estate industry has led to the increase of Gross Domestic Product (GDP) in the economy as it has been evident by a large number of residential houses and the real estate services.
The real estate industry has promoted the development of consumer markets. The real estate requires a lot of raw material input in terms of cement, bricks, timber, and even steel in order to develop itself. Thus, introducing the both construction and manufacturing industries to the field work. Good Economic Prospects in Real Estate.
Real estate industry employs thousands of people and their income is derived from this industry. People get jobs as masons, plumbers, or even carpenters. Furthermore, real estate act as a great factor in seeking finances, for example, loans. Real estate acts as a buffer against inflation and vulnerability.
Government has made it a chief source of tax levied from real estate. Stamp duty is a form of this tax. The government impose taxation on many development projects like road construction, the construction of public schools, hospitals etc. There are some other indirect ways in which the real estate industry has led to the development of the economy such as the sales of real estimates which automatically increases in real estate prices.
Real estate transactions are completed through land ownership at different points. Therefore, in order to complete transaction amicably, the government should make it simple for both citizens and foreigners to hold land.
For property registration and issuance of title deed, the government will achieve protection of buyers from cheated claims. The government will ensure there must be a department of property registry where the title documents and survey records should be kept. Both the investors and potential land buyers are advised to make visit to this department to verify the legality of the piece of land before engaging in any transaction.
Taxation forms the greatest source of revenue to the governments. Sellers of real estate tend to raise the value of their property. So that they can increase their profits after the taxes are deducted.
1. Debt-Based Financing:
this is where one borrows money from a creditor and repays it later with interest.
2. The Equity-Based Financing:
it has a considerable loss on ownership and control. Two types of equity-based financing exist and these are private and public equity.
This refers to a person or party that links a seller to a buyer that is they act as an intermediary between these two parties. When acting on behalf of the buyer, he/she helps the buyer to buy an estate at the least possible price and when acting on behalf of the seller, he helps the seller find a buyer who will pay the highest amount of money for that estate.
Information is power. The government should ensure that the real estate investors and the buyers acquire the right information in time. This information will help them in deciding on the investment opportunities to undertake and where to invest.
This is a call for land division into various uses such as industrial, commercial, and even residential purposes.
1. There must be the creation of good legal and economic environment of real estate business.
2. Passing legislation is required that will safeguard both the investor and buyers.
3. Introducing structures to oversee control in the industry.
4. To ensuring the public confidence in the industry for investment purposes.
5. To ensuring that investment finances are readily available.
From the above-mentioned information, it is quite clear that the real estate industry plays a significant role in both economic growth and development as well. It is therefore the incentive of each government to ensure the participation by the investors. The government has also a big role to play in ensuring that it sets aside adequate cash in its budget to carry out adequate research in this field and thus encouraging innovation of cost-effective housing facilities for its citizens.
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