Uncover the differences between real and personal property within the real estate sector. This article demystifies these critical concepts, guiding investors, buyers, and sellers to navigate their property transactions smoothly


The world of real estate is replete with terminologies that can be daunting for the uninitiated. Two terms that often cause confusion are “real property” and “personal property.” Understanding the distinction between these two is crucial in making informed decisions in real estate transactions and investments.

Real Property: The Immovables

Real property, also known as real estate, refers to land and anything permanently attached to it. This includes buildings, houses, trees, minerals, and other resources affixed to the land.

The Scope of Real Property

In essence, if you purchase a piece of land with a house on it, the entire entity – the land, the house, and any fixed installations like a built-in wardrobe or a stationary hot tub – would be considered real property. Additionally, real property encompasses immovable fixtures, structures, and improvements made on the land.

Personal Property: The Movables

In contrast to real property, personal property (sometimes referred to as chattels or personalty) pertains to assets that are not affixed to the land or the buildings. These are items that can be easily moved.

The Range of Personal Property

This includes various movable assets like furniture, vehicles, jewelry, and even intangible assets such as bonds and stocks. It’s important to note that an item’s status can change depending on its usage. For example, a standalone washing machine would be considered personal property, but once installed into a fixed utility space, it may be categorized as real property.

Real vs. Personal Property: Why the Distinction Matters

You might wonder why the difference between real and personal property matters. Here’s why the distinction is crucial:

  1. Sales Transactions: During property transactions, it’s vital to specify what is included in the sale. Any confusion about what is real or personal property could potentially lead to disputes.
  2. Insurance and Taxation: The classification of property also impacts the way property is taxed and insured. Real property is typically subjected to real estate taxes, while personal property may attract personal property taxes.
  3. Legal Aspects: Different laws apply to real and personal property. For example, creditors’ rights may vary depending on whether the property in question is real or personal.

Conclusion: Navigating the Real Estate Landscape

The nuances between real and personal property can seem complex, but with a deeper understanding, these concepts will eventually become clear. As you venture into the realm of real estate investment or prepare for property ownership, these distinctions will become pivotal in your journey, helping you make well-informed decisions and navigate the property market with confidence.

.About the Author
Bryan Watkins is a Principal and co-owner of LRA Real Estate Group LLC, located in Mesa AZ. He is a ‘hunter-gatherer’ of wise advice, smart advisors and savvy clients. Search available LRA commercial listings today. You can reach Bryan at:  bryan@LRAphx.com or 480.734.7878.
Bryan Watkins, LRA Real Estate Principal