Real estate encompasses land and everything that is permanently affixed to it, including natural objects like water, rock or trees as well as artificial – man-made – ones like houses, roads and fences. It also includes the rights associated with a piece of land, such as air space and valuable mineral deposits below the surface. Real estate distinguishes itself from personal property, which refers to items not affixed to land such as jewelry, vehicles and furniture.

There are several career paths in real estate, from home improvement and building to lending and investing. Some people choose to become brokers, who sell and manage properties for a fee. These professionals use market data and their local knowledge to assess a property’s value, advise clients on how to best maximize their investment and negotiate sales.

Another way to enter the field is by becoming a sales associate. These individuals work under the supervision of a broker and may sell or rent properties on behalf of their employer. They may also provide support services, such as showing properties to potential clients or conducting market research.

Some people may prefer to invest in residential real estate, which is property (both land and buildings) used for the purpose of occupation by individuals. This is typically in contrast to commercial or industrial real estate, which is used by businesses that generate revenue such as offices, stores and factories. Learn also:

Investing in real estate can involve significant upfront capital and debt in the form of mortgage payments, making it a risky endeavor. However, if handled properly, it can yield substantial returns over time. The industry is closely related to broader economic trends and is a leading indicator of an economy’s health, generating jobs in construction, home improvement, lending, insurance and more.

New buildings – office towers, apartment complexes and strip centers – all get their start during the development phase of real estate. Developers, architectural firms, engineers, contractors and municipal officials all come together to create these projects, which are then sold or leased to tenants.

Most real estate falls under one of two categories: residential and commercial. Residential real estate consists of homes, including single-family residences and multifamily rental units, as well as mobile dwellings like houseboats. Those who purchase residential real estate may own it outright or finance it through a mortgage. Others may lease it from a landlord.

Commercial real estate consists of buildings and land that are zoned for business use, such as retail and office spaces, warehouses and manufacturing facilities. These can be bought or leased by businesses that are interested in operating a commercial venture, such as a nail salon or restaurant, and then used to generate revenue for the company. Commercial real estate is also used for storage and distribution, with large facilities such as malls often housing multiple retailers under one roof.