What is classified as "investment property"?

Investment property is specifically classified as real estate that is purchased with the intention of generating income or profit. This can include residential rental properties, commercial real estate, and land that can appreciate in value or be developed. The defining characteristic of investment properties is their use as a financial asset aimed at producing returns through rental income, appreciation, or both.

The other options do not fit the definition of investment property. Personal use property primarily serves the owner's lifestyle and is not used to generate income. Properties in historical districts can be investment properties if they are purchased for that purpose, but not all properties in such zones qualify under this classification. Inherited properties may vary in their use and intentions for future ownership, and simply inheriting property does not inherently classify it as an investment property without the intention of generating income or profit. Thus, the most accurate classification for investment property is based on its operational objective, which is to produce revenue.