What is the Difference Between Property and Real Estate

The main difference between property and real estate is that property includes both movable and immovable things while real estate only includes immovable property.

Property involves both tangible and intangible things of value. Moreover, there are two types of property as real property and personal property. Real estate is real property. It refers to property involving land and the buildings on it, along with its natural resources like trees, minerals and water.

Key Areas Covered

1. What is Property 
     – Definition, Features, Types
2. What is Real Estate
     – Definition, Features, Types
3. What is the Difference Between Property and Real Estate
     – Comparison of Key Differences

Key Terms

Property, Real Estate, Real Property

What is Property

Property is a term that refers to something owned by a person or a business. This includes not only money and tangible things of value like land, vehicles and buildings, but also intangible things considered as a source or element of income or wealth.  We classify property into two categories as real property and personal property. Real property includes all immovable property – land, growing plants, buildings, and other fixtures. In contrast, personal property includes movable property, such as goods, machinery, and animals. Intangible items like intellectual property, stocks, bonds, etc. also fall under personal property.

There are different types and variations in the property. Common property occurs when more than one person has ownership of the same possession. The public property indicates the ownership by a governmental body such as the state, county or city governments or their agencies. Community property indicates joint ownership between husband and wife. Moreover, commercial property refers to buildings or land intended to generate a profit, either from capital gain or rental income.

Most properties have current or potential monetary value; therefore, they are considered as assets. However, they can also be liabilities in some situations. For example, if a worker gets injured while using a company’s machine, the company may be legally responsible for paying compensation for the injured worker. Furthermore, the government and the law are obligated to protect property rights and help clarify ownership.

What is Real Estate

Real estate refers to land and any permanent developments attached to the land (either natural or man-made) including buildings, fences, bridges, water, trees, and minerals. It also includes air rights above the land and underground rights below the land. To be more specific, real estate is real property.

There are five main types of real estate as residential, commercial, industrial, land and special use. Residential real estate involves property used for residential purposes – for example, single-family homes, townhouses, condos, duplexes, etc. Commercial real estate, on the other hand, refers to property used exclusively for business purposes, such as offices, hotels, shopping centers, gas stations, grocery stores, and hospitals. Industrial real estate involves property for industries that involve manufacturing, production, distribution, and storage. Some examples for industrial real estate include factories, power plants and warehouses. The category of land involves undeveloped property, agricultural land and vacant land. Moreover, special purpose real estate refers to property used by the public, such as government buildings, libraries, parks, cemeteries, and schools.

Difference Between Property and Real Estate

Definition

Property is any tangible or intangible item that a person or a business has legal title over while real estate is a property involving land and the buildings on it, along with its natural resources like trees, minerals and water.

Nature

While property includes both movable and immovable things, real estate only includes immovable things.

Types

Property involves tangible things like land, vehicles and buildings, and intangible things considered as a source or element of income or wealth. Real estate includes land and any permanent developments attached to the land (either natural or man-made) such as buildings, fences, bridges, water, trees, and minerals.

Conclusion

Property is any tangible or intangible item that a person or a business has legal title over while real estate is a property involving land and the buildings on it, along with its natural resources like trees, minerals and water. The main difference between property and real estate is that property includes both movable and immovable things while real estate only includes immovable things.

Reference:

1. Chen, James. “Real Estate Definition.” Investopedia, 7 Aug. 2020, Available here.
2. “Legal Definition of Property: Everything You Need to Know.” UpCounsel, Available here.

Image Courtesy:

1. “1586145” (CC0) via Pxhere