If you need to understand the real estate market properly you will need to get a fair amount of idea about the various types of investors that are present in the market. So what are the various kinds of real estate investors that you will encounter if you get in the business? Take a look.
Based on the investment motive
Based on the motive of the investment the three major categories of investors that are present in the market are –
• Speculators – they are the people you should never believe in. speculators are the kind of people who will make it seem like investing in real estate is really easy. They will claim to have made a million dollars just by real estate investment.
• End users – they are the most common category of real estate investors that you will find.
They are the ones that have the intention to buy and stay in that house for a really long time.
They don’t see it as a financial decision but as a lifestyle choice.
• Long term investors – they are the ones that invest in the market to make money and their decisions are really long term. They do understand how the market operates and will invest over a lot of years.
Based on the degree of control
The two categories in which they can be divided are –
• Active investors – they are the kind of investors who love to manage their property themselves. They conduct various repairs and find tenants but also make sure that no damage has been done to their property.
• Passive investors – they are long term owners of the property but they don’t have the slightest interest whatsoever in managing the property. So they hire employees who can do it or hire real estate management firms to do it for them.