What is an investment property in real estate?

An investment property in real estate is defined as a property that is specifically acquired with the intention of generating income, either through rental income or through capital appreciation, rather than for personal or residential use. This type of property is generally part of an investor's portfolio and is managed with the aim of earning a return on investment.

When focusing on the characteristics of investment properties, they typically include single-family homes, multi-family units, commercial properties, and land, all of which are intended for investment purposes. This distinguishes them from properties that are purely personal residences, which serve no financial investment objective apart from shelter.

Other options presented do not align with the definition of an investment property. For instance, a property solely for personal residence is meant for living, not for investment. Similarly, a property bought solely at auction for resale may not necessarily be viewed as an investment unless it is also generating income or intended for profit through capital appreciation. Lastly, a family home that is being rented out could be considered an investment property, but the description is more specific and does not encapsulate the broader concept of investment properties that are not necessarily tied to personal ownership or use.