The Real Estate Sector in the Rental MarketSummary “Real estate is land, all natural parts of the land such as trees and water, and all permanent improvements such as fences and buildings. . People use real estate for a wide variety of purposes, including retail, office, manufacturing, housing, ranching, agriculture, recreation, worship, and entertainment. (Answers.com) In order to focus more specifically on a specific area of ​​real estate, this discussion will focus on the housing sector of real estate. In this discussion, when housing is analyzed, it will fall under the realm of rental real estate. Land Uses As with any other product or resource, the rental property market is affected by supply and demand. “When we divide the land market into land use markets, then supplies are not fixed and prices and profits work like any other market. » (Microeconomics 396) When analyzing the housing bubble, it is important to understand that the rental real estate market is not necessarily negatively affected. “The term bubble means that the price of an asset is increased by speculation or gambling rather than by the value of the services provided by the asset.” (Microeconomics 396) Often, the housing bubble involves speculative real estate that is in a fluctuating market. For example, homes located near resort areas will see their value change significantly as the effects of the bubble change. One of the constant factors in the real estate market is the average rental market price, which can actually experience an increase in demand when more expensive real estate becomes inaccessible. ...... middle of paper ...... value is rental real estate. When other factors contribute to homeownership frustration, such as rising taxes, utility costs, insurance costs, and the sudden need for repairs, the only constant resource is rental property that can usually be absorbed by the investor who owns those properties. . (nd). Encyclopedia of American History. Retrieved April 20, 2008 from Answers.com website: http://www.answers.com/topic/real-estate-industryBoyes, Williams & Melvin, Michael “Microeconomics” seventh edition, Houghton Mifflin Boston (2008) Melville, Sandra Real Estate Costs and Responsibilities Retrieved April 20, 2008 from Downtownsandiegoproperties.com (2006) Website: http://www.downtownsandiegoproperties.com/real_estate_costs.htm