Define: Real And Personal Property

Real and personal property are two main categories of property ownership recognised in legal systems.

Real property refers to land and anything permanently attached to it, such as buildings, trees, minerals, and water rights. It encompasses both the surface of the land and everything beneath it, extending upwards into the airspace above it. Real property is typically immovable and includes interests such as fee simple ownership, leaseholds, and easements.

On the other hand, personal property, also known as chattels or personalty, encompasses all property that is not classified as real property. It includes movable assets such as vehicles, furniture, money, securities, intellectual property, and tangible items like clothing and electronics.

Distinguishing between real and personal property is important for legal purposes, including taxation, inheritance, and property rights. Real property transactions are subject to specific laws and regulations, such as those governing land ownership and transfers, while personal property transactions are governed by different legal principles.

The terms ‘real property’ (or ‘realty’) and ‘personal property’ (‘personalty’) derive from the mediaeval judicial remedies that were available in disputes over ownership. A ‘real’ remedy involved the return of the thing itself, while a ‘personal’ remedy was satisfied by the award of the value of the thing. Where the thing in dispute was land (or, strictly speaking, an interest in land), then in most cases a personal remedy would not be adequate; for most people there would be no adequate substitute for the land itself. Land does not move: if someone else is occupying my land then I need him off, not another piece of land somewhere else. On the other hand one cow, for example, maybe as good as any other. Such considerations led to the notion that ownership of land was fundamentally different from ownership of other things (specifically, moveable things), and this, in turn, leads to our modern concept of ‘real property. This term is difficult to accord a precise definition, but in practice, it is usually taken to mean interests in land, buildings and fixtures on land, and rights to the enjoyment of land. Everything else is ‘personal property.

This site contains general legal information but does not constitute professional legal advice for your particular situation. Persuing this glossary does not create an attorney-client or legal adviser relationship. If you have specific questions, please consult a qualified attorney licensed in your jurisdiction.

This glossary post was last updated: 29th March 2024.