Real Estate 
Definition
Any land or building construction that has some value attached to it and that can be used as collateral.
Use
Use the real estate collateral object for maintaining the collateral-specific details and other details specific to the business of real estate. These details can be used for managing the real estate as collateral in banks.
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Structure
For information on collateral objects, see
In addition to the general master data, the following information specific to the business of real estates can be maintained:
Identification
The location of a real estate object largely influences its value. Use the location descriptors and the address details to describe the location.
Land Register:
It is possible to maintain the land register details of the real estate by using the land register function. You can enter the land register pages separately for the main real estate object and the individual building parts(in the screen Building Parts.
The standard system allows you to maintain country specific land register information by using the real estate land register. The appropriate Business Add-In is implemented by using the country code of the real estate object.
For detailed information, see
Valuation summary
This screen contains the following sections:
Collateral Value Details
In this section, you can specify the purchase price and the final value for the collateral object. The charge on a collateral object is calculated using the final value. You can also specify the type of valuation, the duration for which the valuation has been valid and dates specific to re-valuation for the real estate.
The standard system provides a valuation process that you can use to determine the value of a real estate object. The valuation process is defined using two calculation methods namely the cost depreciation method and the income capitalization method. For more information see,
Land
Present an overview of the real estate object land and the corresponding costs such as the total size of the land and the area available for lease. The relevant costs include the total land cost, development cost and any other additional cost.
Description
Enter the total area available for residential and lease purposes along with the number of units for each of the building parts. The total usable area (in area or as volume) is the sum of the sizes of the individual building parts.
Construction
Present an overview of the real estate building construction. Specify the construction methods, expenditures on the exteriors and the relevant dates. The methods of construction could be used to determine the prospects for reutilization for a real estate object. The construction relevant costs could be used in the determination of the lending value for the whole real estate object.
It is possible to monitor the construction using the important dates for construction. Such monitoring is normally required for the disbursement of finances for the receivables.
Costs
Maintain the different costs relevant for the valuation of a real estate object. Some such costs include the construction, maintenance and any other general costs such as incidental and registration costs.
The cost details must always be entered against a cost type. You can account for the increasing costs using the functionality for allowable costs. You can maintain costs for both, the main real estate object and the individual building parts.
Usage
The following characteristics describe the use of a real estate object:
Usage
Usage could be maintained separately for the main real estate object and the building parts. You must select one main usage type and two additional usage types to appropriately describe the usage of a real estate object.
You define the usage types in the Implementation Guide (IMG) Customizing by choosing Collateral Management ® Object Management ® Collateral Objects ® Real Estate ® Real Estate Attributes ® Define Usage Types. Some examples of usage types include commercial, medical practice and shopping complex.
Utilization
Determine if the real estate object is being used for self occupation, commercial purposes or for both self and commercial use. Maintain the utilization type for every real estate object or building parts. If the real estate object is used for commercial use, then the rental proceeds of a real estate object could be used in the calculation of the capitalized values for a real estate object.
The standard system provides the following utilization types:
· Self
Rental details cannot be maintained for utilization type Self. You must select a utilization type to create a real estate object.
· Rented or leased
· Mixed
· Unused
· Leasing with purchase option
· Leasing without purchase option
Building parts
The maintenance of object parts is a characteristic feature provided by the Object Management (OM). The building parts have the following features:
· Each building part must be created against a building part type.
· A building part type can be assigned to different real estate types simultaneously.
· Most of the master data for the real estate object is also possible for the individual building parts.
· The collateral specific details such as values, safety discounts and lending rates can be maintained for the individual building parts.
· Some building parts can be maintained as accessories or special equipments.
· Building parts can be maintained as accessories, if required.
· If building parts exist, the values of the building parts are consolidated along with the values of the main real estate object.
You define building part types in the Implementation Guide (IMG) under Real Estate ® Define Building Part Types.