When dealing with the real estate and housing market you need to know who the main players are. There are the developers who will go onto a piece of virgin or undeveloped land and will prep it for either commercial or furnished apartment use. The facilitators are the professionals that work with both buyers and sellers, they are bankers (loan officers) and real estate broker attorneys and anyone else that is involved with the legal paperwork surrounding the real estate deal. The owners can be two types, one will be people who will both own and live in or use the property. The other type of owner is an investor. They won’t use or live there, but they invest in the property and will lease it out to others to develop and use. Then you have the renovators who will come in and refurbish buildings. Lastly the renter, these are people who simply rent the properties from owner/investors.
So when looking at the people involved in the real estate and housing market it is clear to see that the demand comes in from the owners, investors and the renters. These people give the developers and renovators jobs.
Real estate is considered a durable investment. This is because land lasts forever and buildings will last for years and years. The real estate market is closely kin to the stock market in the way the demand and supply fluctuates. Today roughly 98% of the housing market supply are made up from existing developed properties. This means that only 2% makes up new developments. The more property is developed the higher the existing supply will go eventually.
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