fundamental distinction has long been drawn between "investment" and "speculation" in real estate or any other form of investment (Sirmans & Jaffe, 1988, pp. 17-18). In popular usage, the distinction is probably most often made between "safe" investments with relatively moderate yields on the one hand, and "risky" investments with higher yields on the other hand, the latter being regarded as speculative. A typical example from the 1980s was the popularity of high yield, high risk "junk" bonds. A distinction may also be made between investments which are intended primarily to provide a steady current income, and investments which are intended primarily to produce a capital gain at some future date. Certainly the latter is more risky: the current rental income from a property can be estimated quite closely on the basis of recent experience, and of experience in the area of the property in terms of market rents, vacancy rates, and so forth. The future value of a property and thus its prospective capital gain value is inherently more uncertain.
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