Residential and Commercial Properties -What’s the Differences

by | Feb 23, 2023

To summarize…Commercial properties include apartment complexes, industrial spaces, hotels, retail spaces and office spaces.

A residential property is any property that has between one and four residential units. This can include a single-family home, a townhome, a condo, a mobile home, or a multiplex building.

Examples of residential real estate

  1. Single Family, Detached Homes
  2. Duplex, Triplex, Fourplex
  3. Townhouse
  4. Some housing co-operatives
  5. Condominiums

Advantages to residential real estate include strong demand, relative ease of financing, and good performance through all economic cycles.

Potential disadvantages to residential real estate are more landlord responsibilities and increased competition from other investors wanting to buy rental property.

Examples of commercial real estate

  1. Land Investments
  2. Large-Scale Multifamily Housing
  3. Office Buildings
  4. Retail Space
  5. Storage Units
  6. Industrial Buildings
Red house among the green houses for real estate property industry

Some advantages to commercial real estate include larger rental income streams, the ability to pass property tax and insurance costs to tenants, and renting to businesses instead of individuals.

Disadvantages to commercial real estate are the high cost of purchasing property and volatility during economic recessions.

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