Residential property is any building or unit zoned and purposed as living space. It’s one of two general categories of real estate, the other being commercial property.
Residential property is usually owner-occupied, but not necessarily. By real estate industry convention, any properties with fewer than five units — none of which are for commercial use — are classified as residential. Larger properties and those with mixed residential and commercial use, then, qualify as commercial.
Types of residential property
The iconic example is the single-family home. Definitions differ but, generally speaking, it is building containing one dwelling unit, detached from all other structures, with open space on all sides.
Multi-family homes of two, three or four units also constitute residential property. So do townhomes and semi-detached homes.
Because their purpose is return on investment, rental properties with five or more units — whether they’re apartment buildings or apartment communities — are commercial property, not residential.
Although condominium units themselves are residential, the buildings they comprise are commercial.