Types of real estate property in India

There are different types of real estate investments based on the type of property that you choose for your undertaking. We can divide the properties into several main categories and there can be subdivisions in each category. Here are the basic types of property that you need to be aware of if you are considering to become a property investor:

Residential properties – these include houses, both single-family homes, and HMOs, apartment buildings, townhouses, condos, vacation homes. A person or family pays you a rent to live in your property. You sign a lease agreement with them, which is for a different duration. Vacation properties are a popular source if higher rental income but it depends on the season. Within residential properties, there is a special division for college rentals. These are properties that are in a university or college area and are primarily rented out to students.

Commercial properties – they include mainly office buildings and skyscrapers. You lease the offices to companies or business owners who pay a rent to use the property. Usually, the lease contracts are signed for several years, which has both its pros and cons. On the one hand, your income is secured over a long period of time and in case the rental rates decline, your income is still protected. On the other hand, however, if the rents go up you are not able to increase your income since it has to follow the concluded agreement.

Industrial properties comprise of warehouses, storage units, car washes or another special purpose real estate. These are leased to companies and businesses for a given period of time.

Retail properties are shopping malls, strip malls, and other retail places. Quite often the landlord may also receive a percentage of the sales generated by the store in addition to the rent.

Land also offers the option to generate income by purchasing and reselling it.

Mobile homes – this type of investment is perhaps more popular in the USA. Basically, if you invest in owning a mobile homes park you own the land and/or the mobile homes. Thus, you receive rent for both the land and the homes.

It is a good idea to include different types of property in your portfolio. If you are a beginner, it is better to start with residential properties as the investment in the other types is more complicated and you will benefit from having a bit of experience in the field prior to trying it out.