“Real estate is an imperishable asset, ever increasing in value. It is the most solid security that human ingenuity has devised. It is the basis of all security and about the only indestructible security.”
- Russell Sage
Meaning of Real Estate
• The term 'real estate' refers to land as well as building. The word ‘land’ includes the air above and the ground below and any buildings or structures on it.
• It is a term that encompasses land along with those improvements to it such as commercial and residential structures, roadways and ports that are all fixed in location.
• Thus the term real estate connotes immovable property which can be either land or building or both.
• Real estate transaction includes purchase, sale and development of land (residential and on residential buildings).
• Construction is the process of building new infrastructure on real estate. Given their close inter-linkages, these sectors are often treated as one.
Real Estate Market in India
• Real Estate Sector in India is the second largest employment generator sector after agriculture.
• The real estate sector plays a crucial role in the Indian economy. The housing sector alone contributes to 5 to 6 per cent of the country’s GDP.
• Not only does it generate a high level of direct employment, but it also stimulates the demand in over 250 ancillary industries such as cement, steel, paint, brick, building materials consumer durables and so on.
• Real estate has also emerged as the popular sector for private equity (PE) funds, which witnessed investments worth US$ 1,700 million in the sector during 2011.
• According to a recent report, India will continue to maintain a GDP growth momentum of 9-10 percent by 11 2015 as the country will witness new private equity in capital markets which will inject capital in infrastructure projects. Some of the avenues for investment in the sector include: Commercial complexes, Multiplexes, Restaurants and Hotels, Malls and shopping complexes.
• The residential segment makes up most of the real estate industry in the country. Growth in this segment is primarily driven by increasing urbanization, rise in the number of white-collar professionals and rising incomes, etc.
• Overall, on pan-India basis, the demand for office space is expected to total 180 million sq.ft by 2013, with seven major cities (Bangalore, Chennai, Hyderabad, Kolkata, Mumbai, the NCR and Pune) catering to 75% of the total demand Players in Real Estate market.
The main players in the real estate market include the following:
• Real estate agents
• The landlords
• The builders & developers
• Construction contractors
Real Estate Agents –
A real estate broker or real estate agent is a person who acts as an intermediary between sellers and buyers of real estate/real property and attempts to find sellers who wish to sell and buyers who wish to buy. In the United States, the relationship was originally established by reference to the English common law of agency, with the broker having a fiduciary relationship with his clients.
Real Estate agent is the term used in the United Kingdom to describe a person or organization whose business is to market real estate on behalf of clients, but there are significant differences between the actions and liabilities of brokers and estate agents in each country. Beyond the United States, other countries take markedly different approaches to the marketing and selling of real property.
Real estate brokers and their salespersons assist sellers in marketing their property and selling it for the highest possible price under the best terms. When acting as a buyer's agent with a signed agreement (or, in many cases, verbal agreement, although a broker may not be legally entitled to his commission unless the agreement is in writing), they assist buyers by helping them purchase property for the lowest possible price under the best terms. The real estate broker "broker" is obligated to provide fiduciary duties to whomever that broker services as client, this agency relationship can become very confusing; if the broker is helping both the buyer and seller, this is called dual agency. Traditionally, the broker represents the seller, and has a fiduciary duty to the seller. If the broker suggests to the buyer that he will help them negotiate the best price, then it is said the broker is practicing undisclosed dual agency, which is unethical and illegal in all states. Under a dual agency transaction it is vital the broker discloses to either/or part whom they represent as client, and whom they represent as customer. A real estate broker owes his client fiduciary duties, those duties include care, confidentiality, loyalty, obedience, accounting & disclosure. A real estate broker owes his customer fair & honest dealing. A real estate broker must request all parties (seller & buyer) sign a dual agency agreement, to protect their license.
In most jurisdictions, a person must have a license before they may receive remuneration for services rendered as a real estate broker. Unlicensed activity is illegal, but buyers and sellers acting as principals in the sale or purchase of real estate are not required to be licensed. In some countries, lawyers are allowed to handle real estate sales for compensation without being licensed as brokers or agents.
The AREA is the India's leading professional body for estate agents. Our main functions include Regulating, Guiding and assisting property professionals across a wide range of disciplines. We also work to make the Real Estate market safer and easier to use and understand when you are buying a home or selling your house.
The purpose of the AREA (Association of Real estate Agents) is to serve its membership in developing and promote.KJG.ng programs and services that will enhance the member’s freedom and ability to conduct their individual businesses successfully with integrity and competency, and through collective action, to promote the preservation of real property rights.
Every year, unlicensed agents are suffering from unnecessary stress and hassle - and sometimes loss of money - by giving incorrect or misleading advice or offering poor standards of customer service.
AREA is committed to professionalism in real estate, superior client service and competent transaction coordination.
The core purpose of the AREA (Association of Real estate Agents) is to help its members become more profitable and successful.
Make advance responsible commercial real estate development, investment and ownership.