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Understanding Real Estate Investment Types
Real estate investment isn't one-size-fits-all; it encompasses various types, each with unique benefits and risks. Residential properties, such as single-family homes and condos, are common starting points for investors due to their relative stability and potential for rental income. On the other hand, commercial real estate, including office buildings and retail spaces, often offers higher returns but requires more substantial capital and expertise.
Real estate investment trusts (REITs) provide an alternative for those seeking exposure to real estate without direct property ownership. REITs are companies that own or finance income-producing real estate and offer dividends to investors. This option allows individuals to invest in large-scale properties, such as shopping malls or hospitals, with the benefit of liquidity similar to stocks2.