Define: Investment Property

UK Accounting Glossary

Definition: Investment Property



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Full Definition of Investment Property


Real property owned by an entity for other than its own use is an investment property. In other words, investment property is real estate held for portfolio purposes. Significant features of the US tax code make investment property a tax-advantaged asset class. Most notably, under the IRS section 1031 exchange provisions, the taxable gain on the sale of investment property can be deferred indefinitely by exchanging the investment property for another “like-kind” property, where “like-kind” has gradually become loosely interpreted as meaning any other investment property (or group of properties) of equal or greater value. An investment property does not have to be held for profit. In New York City, some major landlords lease entire office buildings to non-profit organization tenants for tax purposes. An individual’s home is not classified as an investment property, but homeowners nevertheless commonly speak of their home as an investment. Similarly, an industrial concern’s wholly-owned operating site is a user property, rather than an investment property.


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Definition Sources


Definitions for Investment Property are sourced/syndicated and enhanced from:

  • A Dictionary of Economics (Oxford Quick Reference)
  • Oxford Dictionary Of Accounting
  • Oxford Dictionary Of Business & Management

This glossary post was last updated: 9th February 2020.