Real estate capital markets offer individuals and businesses a way to invest in real estate without actual-ly buying property themselves. Investors have the benefit of being financially backed by either a mort-gage or another property, rendering this a relatively safe investment type.
The real estate capital market forms part of a bigger group known as debt capital markets, which in-clude investment bonds. Funders can either invest directly or indirectly in this capital market.
Real estate loans can be broadly categorized in residential and commercial real estate. Although they both essentially do the same thing, their approach is slightly different.
Residential loans focus primarily on smaller loans compared to commercial property loans, and come in all shapes and sizes. Some examples of these include fixed-rate mortgage loans, adjustable-rate mort-gage loans, conventional loans and so forth.
Commercial sources of funding can be diverse and shifting, and when it comes to the real estate capital market they usually comprise one of the following: