Business, Legal & Accounting Glossary
A property that is not occupied by the owner, usually purchased specifically to generate profit through rental income and/or capital gains. opposite of non-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.
My brother and sister-In-law’s vacation house, its furnishings, and 15 acres, were completely paid for with income from their investment property.
If an individual purchases a piece of real estate not as a residence, but either to sell, or use to generate income, it is an investment property.
Charlie received a very large bonus last year. He was trying to figure out what to do with that money, so he decided to purchase an investment property at the beach.
primary residence
one percent rule
second home
band of investment
property portfolio
occupancy fraud
non-investment property
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This glossary post was last updated: 5th November, 2021 | 0 Views.