Economists have defined four types of returns: Wages, Rent, interest and profit. It is common knowledge that returns from the ownership of real estate do command rent. From a certain perspective capital appreciation can be clubbed under the of interest. Why interest? Because there is a value to parting with cash and investing in real estate which gets realised as a compounded value. What about the extra amounts earned? Can it be classified under the 3rd category of profit? Maybe....comments please....
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