Why is Real Estate called Real?
When you invest in a property, you are supposed to own a Real Estate, which can be broken into two different parts, real and estate. Realis is a Latin term that means existing, actual, or genuine. It was considered to be used in a legal context in Middle English to refer immovable property (i.e., house, building or structure), as opposed to personal property, such as clothing or furniture. The term “estate” on the other hand can be traced to be derived from the Latin term status, which means state or condition and its French derivative is estat, which typically refers to an individual interest, ownership, or property.
Defined by Merriam-Webster as the property consisting of buildings and land, the combined term real estate was first coined in London in 1666, the year of the London Fire. Ironically, this was the year much of London’s real estate was demolished.
In legal terms, the meaning of real estate is the property and all of its “real” and “fixed” components. Portable and personal property do not count as real estate even if it is inside a real estate property.
Real estate is a rare type of investment that you actually get to live in and owning real estate offers major financial incentives that investors make out of it. Even if you are not a real estate investor, buying real estate could be one of the smartest investments you can ever make.
If you buy a new vehicle for £20,000, after a few years the resale value of that vehicle will be less than half of what you bought it for. That is not the case with real estate, as its value actually appreciates over time.
Beyond appreciating value, you benefit from a number of tax breaks while building equity. You also receive competitive risk-adjusted returns, and your investment is hedged against inflation. It’s also a great way to diversify your investment portfolio.