What is property?

For the purposes of this guide, property (or real estate) is any building, or the land on which that building stands, that can produce a financial return for its owner. That financial return can be in the form of a change in the capital value of the property realised when the property is bought or sold, or rent paid by a tenant to the owner of the property.

Investment in residential property is divided between social landlords (registered social landlords and local authorities), individual buy-to-let landlords and larger 'professional' or institutional landlords.  Together they account for 30% of all residential properties in the UK; the remaining 70% is owner-occupied.

For commercial property, about 50% of investment comes from owner occupiers, with the remainder coming from a wide variety of investors including pension funds, insurance companies, property companies including Real Estate Investment Trusts (REITs), and property unit trusts. Less than 5% of commercial property is owned by individuals; however, in practice, many individuals have an indirect investment in commercial property through pension funds and other collective investment schemes, such as property funds.

Leases matter because they are the principal contractual relationship between the owner of a property and a tenant occupying it. The form and content of the lease will vary, depending on the type of property, and the type of relationship between the owner and the tenant.