Income Property
Real estate purchased primarily to generate rental income or other revenue streams rather than for personal use. These properties can include single-family homes, multi-unit buildings, commercial spaces, or vacation rentals that produce cash flow for the owner.
Example
“Sarah purchased a duplex as an income property, planning to live in one unit while renting out the other to cover her mortgage payments.”
Memory Tip
Income property = 'I come' for the money - you buy it because income comes to you from tenants.
Why It Matters
Income properties provide passive income streams and potential tax advantages, making them popular investment vehicles for building long-term wealth. They can offer both monthly cash flow and property appreciation over time.
Common Misconception
People often think income properties are only large apartment buildings, but single-family rental homes are actually the most common type of income property.
In Practice
A buyer purchases a three-bedroom house for $250,000, rents it for $2,200 monthly, and after mortgage payments and expenses, nets $400 monthly in passive income while building equity.
Etymology
Derived from Latin 'incomings' (revenue) and 'proprietas' (ownership), referring to real estate owned specifically for its money-generating potential rather than personal use.
Common Misspellings
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