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.

Residential real estate can be single-family homes, condominium units, apartments, townhouses, duplexes, and so on. The term residential rental property distinguishes this class of rental real estate investment from commercial properties where the tenant will generally be a corporate entity rather than a person or family, as well as hotels and motels where a tenant does not live in the property long term.