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Residential rental property refers to homes that are purchased by an investor and inhabited by tenants on a lease or rental agreement. Residential property is property zoned for living or dwelling, as opposed to commercial property, which is zoned for business and profit generation.

Commercial property refers to real estate property that is used for business activities. Commercial property usually refers to buildings that house businesses, but it can also refer to land that is intended to generate a profit, as well as larger residential rental properties.

Vacant Land is real estate or property, minus buildings and equipment, that is designated by fixed spatial boundaries. Land ownership may offer the titleholder the right to natural resources on the land. The sale of land results in capital gain or loss; under IRS tax laws, land is not a depreciable asset, and qualifies as a fixed asset instead of a current asset.

A short sale is the sale of an asset or stock the seller does not own. It is generally a transaction in which an investor sells borrowed securities in anticipation of a price decline; the seller is then required to return an equal number of shares at some point in the future. In contrast, a seller owns the security or stock in a long position.

A conventional mortgage or conventional loan is any type of home buyer’s loan that is not offered or secured by a government entity. Instead, conventional mortgages are available through private lenders, such as banks, credit unions, and mortgage companies.

Section 1031 is an Internal Revenue Code (IRC) provision that defers tax on qualifying exchanges of like-kind real estate. Section 1031 is also known as the Starker Loophole. Qualifying Section 1031 exchanges are called 1031 exchanges, like-kind exchanges, or Starker exchanges.

For sale by owner or FSBO is a term that refers to a specific method of selling a property. In an FSBO listing, the owner sells the property without the use of an agent or a broker. Sellers typically choose to sell their home on their own to avoid paying the real estate agent the commission for the transaction.