Real Estate: Definition, Types, and Ways of Business for Beginners

Real estate began to exist in Indonesia since the Old Order government and increased rapidly in the 1980s. The real estate business in Indonesia is increasingly in demand after the increase in people's ability to make purchases.

Even so, the real estate business also has risks, one of which is that a large enough capital is required for the business to run well, costs maintenance and the strategy for managing the purchase of real estate areas also needs to be taken into account. Therefore, let's read more in-depth information about real estate below.

Definition of Real Estate

Real estate is a business in the form of buying and selling of land and immovable equipment such as construction, housing and industry by using a person's permanent ownership status.

Real estate is one of those businesses with high long-term potential. Because the real estate business is growing rapidly according to the demand for land and buildings. On the other hand, the real estate business also has the potential to attract investors to invest in promising real estate projects.

Real estate has a fairly high business risk, where when the project is on a large scale, the higher the long-term funds that need to be provided, this means that the selling price will also be higher. When the price offered to consumers is too high, the market share will not be too good either, because the interest given by consumers will decrease by offering prices that are too high.

Types of Real Estate

The real estate business has types of businesses that business people can focus on. To find out more clearly about the real estate business, then you need to know the selection of real estate types.

Various types of real estate come with different development focuses, including the following:

• Industrial

Is a type of real estate business that focuses on the use of real estate land as a business location, such as factories, warehouses and so on. This type of real estate business is also included in the plantation business such as rice fields to garden land.

The type of industrial real estate relates to how the business produces, distributes and develops the business.

• Residential

Is a type of real estate business that focuses on the use of a building as someone's residence. This type of real estate is usually marked by the size of large and luxurious buildings, housing in elite areas, apartments, small businesses such as shops or minimarkets or other types of residences.

• Commercial

Is a type of real estate business that focuses on commercial interests to generate profit, meaning that this type of real estate usually relies more on businesses aimed at profit. For example business offices, lodging and so forth.

How To Start A Real Estate Business For Beginners 

As explained, real estate is one of the business sectors with promising potential, although in the process risks are also present in developing a real estate business. To make a profit in the real estate business, there are several ways you can start a real estate business as follows:

• Do Research Happen 

To be able to start a real estate business then, we need to do research first about the market share related to the type of real estate business that we want. Research The market is really needed to start a business, because at this stage a businessman will understand how to formulate a strategy, how to increase the value of the products offered, how to find consumers and so on. 

Through research market, business people can get to know the advantages and disadvantages of their products better. Research The market is also carried out to find out the direction of business development that is currently being carried out or is being carried out.

• Strategize

After searching for the business we want, we need to formulate a strategy related to the location we want to occupy, the financing calculations that need to be prepared, how to run it, how to carry out maintenance on this type of real estate and so on. Moreover, pay attention to the risks and unexpected factors that can occur when running a real estate business.

• Looking for Business Capital

Funding is crucial in the real estate business, the larger the real estate project, the greater the capital required. Finding venture capital to run a real estate business is very important, because if at any time the capital is lacking, the development of the real estate business is at risk of being delayed or unable to be resumed.

• Setting up an Emergency Fund

An emergency fund is also a consideration that needs to be prepared if you want to start a real estate business. This fund aims to do back up or cover unforeseen situations over the draft real estate business plan that is being implemented.

Thus some information for starting a real estate business for beginners, in essence real estate is a business that involves land components and the addition of man-made production that can increase its selling value.

Getting started in real estate takes a lot of capital, labor and time to build a high selling point and quality. Therefore, good planning is needed when deciding to run the business.