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GLOSSARY
Real asset
A real asset is property that has value based on its utility. Land and equipment are real assets, but securities holdings are not.
Real estate
Real estate is land. Most of the time, the ownership of land includes ownership of the buildings and resources located on that land.
Real estate agent
A licensed person who negotiates a real estate transaction and represents either the buyer or the seller.
Real estate attorney
A lawyer who specializes in real estate title transfers and property tax issues.
Real estate broker
A broker is similar to an agent but often has agents working under them and takes a percentage of the agent's commission in exchange for office space and overhead. The broker will also represent a buyer or seller in a real estate sale.
Real estate bubble
A rapid increase in the prices of homes followed by a steep drop off.
Real estate investment group
A real estate investment group is an organization that purchases a portfolio of properties that are resold in shares to investors. The group manages the tenants and property maintenance in return for a percentage of rent proceeds.
Real estate investment trust
Referred to as a REIT. This trust invests primarily in real estate and passes the income and losses onto the investors.
Real Estate Investment Trust - REIT
A Real Estate Investment Trust, or REIT, is an exchange-traded security that invests in real estate. REITs often specialize in certain types of real estate investments. For example, an Equity REIT owns rental properties and a Mortgage REIT purchases or funds mortgage loans.
Real Estate Limited Partnership - RELP
A Real Estate Limited Partnership, or RELP, is a business entity formed to profit from land holdings, either through development or capital appreciation. RELP partners participate directly in the business activities.
Real Estate Mortgage Investment Conduits - REMIC
Real Estate Mortgage Investment Conduits, or REMICs, are securities that are backed by segmented pools of mortgages. Each segmented pool supports a different class of security, each of which carries a different maturity and coupon.
Real Estate Operating Company - REOC
Real Estate Operating Company, or REOC, is an exchange-traded security that invests in real estate. REOCs are different from Real Estate Investment Trusts (REITs) because REOCs reinvest earnings back into the business, while REITs distribute all profits to investors. REOCs generally seek to provide investors with strong capital gains (rather than regular income).
Real estate or real property
Real estate or real property are both terms for land, inclusive of the buildings and natural resources on the land.
Real estate owned
Real estate owned is a lender's portfolio of properties that failed to sell at foreclosure auctions. Once the property fails to sell at the auction, the lender must try to sell it on the real estate market. Investors target these properties, because they typically sell at a discount.
Real Estate Settlement Procedures Act
Known as RESPA. A law protecting consumers from abuses and usury that requires lenders to give homebuyers advance notice of closing costs, settlement costs, relationships and lending practices.