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What Does "Real" in Real Estate Mean?

By Mihaela Lica Butler | September 28, 2023

Real estate is a term we often encounter in our daily lives. We hear about real estate agents, real estate investments, and real estate properties. But what does "real" in real estate mean?

real estate

Real estate refers to property that includes land, buildings, and natural resources like crops, minerals, or water. It encompasses residential, commercial, and industrial properties and vacant land.

"Real" signifies the tangible and physical nature of the property. It emphasizes that real estate involves actual, physical assets instead of intangible or imaginary ones. Unlike stocks or bonds, which are financial assets, real estate consists of concrete structures and land with inherent value. The term "real estate" originated from the legal concept of land ownership bestowed by royalty. The term was first recorded in the 1660s, and its roots can be traced back to Early Modern English. "Real" comes from Latin, meaning existence, actuality, or authenticity, while "estate" is an English version of the Old French word "estat," which conveys the idea of status. In many countries, real estate brokers and realtors are still called "land agents."

The term "real estate" has been used for a few hundred years, with the first official record dating back to 1666. During that year, the Great Fire of London caused significant damage to properties in the city, creating new legal terms for different types of property. As a result, "real estate" became a commonly used term in England and eventually spread to the British colonies. Today, it is one of the most frequently used terms when discussing the buying, selling, and renting of various property types.

When you own a piece of real estate, you have ownership of a physical property that can be used for various purposes. Whether it's a house for living, an office for business, or a piece of land for development, real estate provides tangible assets that serve practical functions.

The physical characteristics of real estate contribute to its overall value. Factors like location, condition, size, and amenities influence the worth of a real estate property. Unlike virtual assets, the value of real estate is derived from its physical attributes and the demand for its use.

Real estate professionals, such as agents and brokers, are crucial in facilitating property transactions. They specialize in dealing with physical properties and possess extensive real estate market knowledge. Their expertise helps buyers and sellers navigate the industry's complexities, ensuring smooth and efficient transactions.

Real estate also serves as a popular investment option. Investors can purchase properties with the expectation of generating income or capital appreciation. The tangibility of real estate investments provides a sense of security and stability compared to other investments. Renting out or developing properties can generate ongoing income, making real estate an attractive choice for long-term wealth creation.

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Mihaela Lica Butler is senior partner at Pamil Visions PR. She is a widely cited authority on public relations issues, with an experience of over 25 years in online PR, marketing, and SEO.She covers startups, online marketing, social media, SEO, and other topics of interest for Realty Biz News.
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