Properties considered as residential are those that people could dwell and live in, such as single-family homes, multi-family houses, duplexes, condominiums, townhouse and apartment buildings. This also encompasses portable dwellings like boats, mobile house and houseboats. It s reasonable enough for investors to choose this type of real estate since a house or a home is one of our basic needs. No doubt everybody needs a adequate place to live and there is a great demand for more housing properties. Residential Properties usually have less costs and price. There are many banks and lenders who can help provide financing on this real estate type. From the view of these banks and financial services, should there be failure in re-paying the mortgages, they can easily get their money back since other investors are ready to buy the foreclosed property.

Commercial properties are places where business dealings and activities are held such as office buildings, industrial complexes, shopping centers/malls, stores and warehouses. Commercial real estates usually have higher rate of return than residential properties. There is consistent income and stability in the investment since there are long term leases offered. Tenants usually fix any damage and repairs on their own. Commercial property owners could have steady income as the value of the property increases. While the disadvantages of commercial real estates include: loans which are hard to obtain and a large amount of money is required up front, commercial spaces are often difficult to lease and can sometime remain vacant for long periods of time.

Real estate prices have steadily increased since the beginning of this decade. However, real estate investors need to do proper planning and to conduct market analyses before investing.