Lecture 2
Jan-May 2015
REAL ESTATE
1. Real property:
Leases
COMPONENTS OF REAL
ESTATE (1)
i). Legal concept of land.
ii). improvements and fixtures
COMPONENTS OF REAL
ESTATE (2)
a) Legal concept of land (cont)
COMPONENTS OF REAL
ESTATE (3)
COMPONENTS OF REAL
ESTATE (4)
b) Improvements and Fixtures(cont)
CHARACTERISTICS OF REAL
PROPERTY
Physical Characteristics:
Land and its improvement is immobile
indestructible and not homogenous
1.
2. Economic Characteristics :
Property is highly priced commodity; expensive
Purchase generally requires borrowed funds.
Search and information gathering costs. The
purchase /buyer will need to search for
information which is scattered before making
decision to buy.
CHARACTERISTICS OF REAL
PROPERTY
2. Economic Characteristics (cont)
Scarcity of the commodity ( land & other
properties)
Location economics , aspect of its location may
affects its value
Quantity and Quality of surrounding
structures/property may influence the value
Fixity; investment in property is fixed it can not
be moved or changed easily and have a long
physical and economic life.
1.1
Regulations:
National or local boards or associations
acts as parent, regulatory or trade
organizations.
The
2.1. Lenders:
Botswana Building society (BBS) Financial
institutions such as national Development Bank
(NDB), BDC, CEDA, Commercial Banks etc .
3. APPRAISERS OR VALUERS
5. ATTORNEY
6. PROPERTY MANAGER
Property
manager specializes in
management of real estate .
Property as an investment is income
producing asset hence a manager is
needed to collect rent , negotiate leases ,
supervise maintenance , reduce expenses
and advise the investor or property owner
on mattes related to the investment