Real Property vs Real Estate: What is the Difference?

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Written By Tommy

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If you’re a homeowner, tenant, or in the real estate business, you need to know the difference between real property vs real estate. This will helps you understand the rights bundled with your property. This blog post will discuss the difference between these terms to help you understand your rights.

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Real Property vs Real Estate: What’s the Difference 

Real property vs real estate; while these terms are related, they each have specific meanings. The differences are subtle but important when it comes to legal implications.

Real estate generally refers to land, buildings and tangible assets; Real Property encompasses a much broader scope. It not only includes the “property” of land and structures but also intangible assets such as property rights.

Real Estate Explained

Real estate is any piece of land or building, as well as the land beneath it and any air above it. The term “real” refers to the fact that the asset is physically real or exists.

There are four main categories of real estate, usually divided by the type of usage of the property.

  1. Residential
  2. Commercial
  3. Industrial
  4. Land

Residential real estate is, as the name implies, focused on housing. It comprises many subcategories, including single-family homes, condos, and vacation properties.

Commercial real estate includes office buildings, hotels, shopping malls, and other types of buildings that are used for retail purposes. Apartments are also considered commercial property because they are used for profit.

Industrial real estate describes properties primarily used for industrial purposes, such as manufacturing and warehousing. Distribution centers can be categorized as industrial properties, but it depends on other factors, such as how the building is managed, where it’s located, and other aspects of the property.

Land real estate refers to any undeveloped property, including vacant lots, farmland, and ranch properties.

Real Property Explained

While many confuse it with “Real Estate,” “Real Property” encompasses more elements than the latter. This is because it not only covers the land, buildings and tangible items but also other intangible assets, such as legal rights.

In addition to things like land and buildings, real properties can include rights to enjoy and use that property, such as improvements to it, occupation of it, control of it, and more.

The rights to real properties include the following:

  1. The right to possession of a property, which refers to your right to occupy it.
  2. The right to control, including the right to determine its interests, use, and disposal.
  3. The right to enjoy it and use it without any third party interfering.
  4. The right to exclusivity, which is the right to limit the use of that property or asset by others
  5. The right to decide what to do with your property includes selling it or giving it away.

Frequently Asked Questions

What are the four types of real estate?

The four real estate types are residential, commercial, industrial, and agricultural.

What are the three types of property?

The three types of property are real, personal, and intangible. Real property is land and any improvements or structures on it. Personal property is anything that can be moved and is not attached to the land, such as furniture or cars. Intangible property is anything that cannot be physically touched, such as patents or copyrights.

Why is it called real property?

The term “real property” describes the land and any improvements or structures on it. The word “real” in this context refers to the fact that the land and improvements are permanent, unlike personal property, which can be moved or sold.

Is land and real estate the same?

No, land and real estate are not the same. Real property is the land and any improvements or structures, while real estate is the business of buying, selling, or renting land and properties.


While real property vs real estate are used interchangeably, some key differences exist. While both include the land, building, and any improvements to it, the difference is that real property also includes any “rights of use” of the property. So, in addition to owning the property, you could also have the right to use it, occupy it, or improve it.