Types of investment properties in Florida

Informations about some ot the different types of real estate available for investment in Florida state. Check for kind of property you can purchase in Florida.

Residential

Residential investment property is available in a very wide range of prices. Most important factors to be considered when selecting residential properties are location, availability of local transportation, local schools and shopping areas. Typical residential investments include condominiums (condos), single family houses, villas, townhouses, and apartments complexes.

Industrial

Industrial investment properties involve manufacturing, assembly plants, and distribution centres. These properties are located most often near major transportation arteries. Weight reducing operations, such as mining operations, prefer locations near the source of their raw materials. Weight gaining operations, such as assembly plants, prefer locations close to their areas in order to reduce transportation cost involve.

Office

Office investment properties are usually located in central business districts or professional office parks in suburban areas near their tenant base. Offices for sale are usually good long term investments since office tenants generally lease for extended period of time. Some companies rent office even for decades.

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Commercial

Commercial investment properties include retail centers, such as regional shopping centers usually located near major transportation routes. Major retail centers attract anchor tenants that draw people to the center. Usually, these are name brand department stores in which people plan to shop. They are called genarative functions, since they generate customer traffic to the center. Suscipient functions are businesses that attract passersby, such as card and gift shops, toys for adults, ice gream, post offices and novelty stores, and so on.

Agricultural

Agricultural property investors have many different motivations for investing in agricultural land. Some investors wish to personally engage in agricultural endeavors, while others may own the land and lease it to others for agricultural activities.
Investors may also purchase agricultural land in the path of growth, allowing for lower taxes through agricultural exemptions, before ultimately selling or developing the property.

Business opportunities

Business opportunities are typically smaller local businesses, such as barbershops, hair saloons, print shops, corner stores, local grocery stores, also boat rental businesses. Often an investor may be looking for a small business that he or she own and manage, creating an income for him or herself.
Business opportunities are normally valued based upon applying a multiplier to the net income being produced by the business. Value may also be applied to intangible assets such as a business’s name or reputation in the community.

What is Real Estate Investment Trust (REIT)

A real estate investment trust (REIT) a type of business trust, allows groups of investors to invest in income producing property. A REIT provides a method for individuals to pool financial resources to invest in larger, professionally managed properties. Investment trusts invest in office buildings, large apartment complexes, and retail centers. Purchasing shares in REIT is similar to purchasing shares in mutual fund.

Analysis of investment in Florida

The purchase of real estate as an investment has been popular for both high and moderate income investors. Most investment decisions depend on the rate of return or profit, which the investor expects to earn by assuming a risk in real estate or other type of investment.
A through analysis is critical when evaluating the potential of a real estate investment. Investment analysis must take into consideration land use controls, such as zoning, deed restrictions, and permitting requirements that affect the value of the property.

Investment analysis considers economic forces, such a population growth, investment of foreign capital, and the impact of taxation on real estate investments. The most important factor underlaying every investment decision is economic soundness.

The process of investment analysis begins with the search for and location of potentially desirable real estate investment that are based upon the investor’s personal objectives. Real estate investor can receive potentially significant rewards from real estate investments that include income generated by the property, a build up of equity, appreciation in value, tax benefits, positive leverage, and prestige. Investment in real estate can also serve as hedge against inflation when the property has level payment mortgage where the payments remain the same, but the rental income increases with inflation.

Disadvantages

Disadvantages of investing in real estate include the illiquidity of property (it cannot be bought or sold as quickly as other assets. The local – immobile – nature of real estate market compared to other types of investments that can be bought and sold in a variety of markets, the expense or overhead required to manage the property or hire a property manager, and the need for additional investment assistance from experts such as brokers, tax accountants and other professionals.