What Is The Difference Between Real Estate And Real Property

Real Estate Broker/Owner with Arizona Resource Realty BR518926000


These two terms are often referred to as people as the same. Though they may sound very similar, Real Estate and Real Property are undoubtedly different from one another. Knowing and understanding the difference between the two concepts can genuinely help you comprehend the subtleties of the land you currently own. Not only that, while the term real estate often refers to as land, it goes a little deeper than that. Within this article, we will be defining the difference between Real Estate to Real Property.


Real Estate


Basically, real estate is a piece of land decorated with natural or artificial improvements added to it. Natural improvements within the real estate include trees, water, oil, and valuable mineral deposits. Artificial enhancements, on the other hand, include buildings standing on it, sidewalks, and fences or gates. Furthermore, real estate can be categorized into two: commercial and residential.


  • Commercial Real Estate


This category of real estate tackles along the business side. The land branded as a commercial real estate should be used for property types such as buildings, malls, restaurants, and other commercial properties. This type of real estate can either be owner-occupied or leased. Industrial real estate is also within commercial real estate. This is where properties used for manufacturing, warehousing, production, and assembly are stood on.


  • Residential Real Estate


Residential real estate, as its name soundly implies, is used for residential purposes. This is a type of property that is intended for human habitation; either by single families or multiple of them. Just like the former, residential real estate can also be owner-occupied or leased, although most properties falling in this category are within leased properties.


Real Property


Between the two terms: Real Estate and Real Property, the latter is the less commonly used term and thus, is often misunderstood. The fact is, real property is the broader term among the two and includes the land itself and also any building or improvements attached to a given land. This also consists of the rights of use. Renters of real property may have the right to inhabit the land, but those things aren’t considered as real estate though they may have with them the bundle of rights.


In conclusion, real estate consists only of the physical objects you get with the land you may have purchased or leased. Real property, on the other hand, consists of both the physical objects as well as the common law rights.


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Tamra Lee Ulmer

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