Real estate refers to property consisting of land and any permanent improvements attached to it, such as buildings, roads, and utility systems. When the legal rights of ownership are added to the equation, the bundle is known as real property. By contrast, personal property includes movable items that are not permanently affixed to land or buildings. The boundary between these categories becomes important when something originally personal—like a light fixture or appliance—is attached to a property so permanently that it becomes a fixture and is legally considered part of the real estate.
Real estate is commonly divided into three main categories based on how it is used. Residential real estate includes property used for housing, ranging from single-family homes to multi-family buildings, condominiums, and cooperatives. Commercial real estate (CRE) covers property used for business purposes, such as offices, retail centers, and hotels. Industrial real estate includes property used for manufacturing, warehousing, and distribution. Some developments combine multiple uses—retail on the ground floor with apartments above, for instance—and these are called mixed-use real estate. Raw land, by contrast, refers to undeveloped parcels without buildings or infrastructure.
Within residential real estate, several distinct property types exist. A single-family home is a free-standing building designed for one household. A multi-family home contains multiple units, such as a duplex, triplex, fourplex, or apartment building. A condominium grants ownership of an individual unit within a multi-unit building, along with shared rights to common areas, while a cooperative (co-op) instead gives owners shares in a corporation that owns the building and grants them the right to occupy a specific unit. A townhouse is a multi-floor home that shares walls with adjacent units.
The two principal forms of real property ownership are fee simple and leasehold. Fee simple is the most complete form of ownership, considered virtually perpetual and including full rights to use, transfer, or bequeath the property. Leasehold, by contrast, involves owning the right to use a property for a defined period, typically through a lease agreement, after which use reverts to the property owner.