The difference between Commercial and Residential Properties

Design and architecture. Caucasian engineer working on drawings of new housing project, sitting in office with blueprint, ruler, divider compass and tape measure. Selective focus on scale model house

Do you know the difference between commercial and residential property? Well, if you don’t then we are here to help you. Though it may sound complex it is very simple to understand.

Commercial Properties

Commercial properties are buildings that are used for business activities, not only does commercial property refer to buildings that house businesses, but it also refers to land that is used to generate profit, as well as large residential rental properties. The Commercial property market is made up of five main categories.

These five categories include:

  • Offices
  • Retail- retail stores, shops, and shopping centres
  • Industrial- warehouses and factories
  • Leisure- hotels, pubs, restaurants, café and sports facilities
  • Healthcare- medical centres, hospitals, and nursing homes
modern business centre

Residential Properties

Residential property is opposite to a commercial, this is because a residential property is a building that is used or suitable for use as a dwelling. Furthermore, land that is in the process of being constructed or buildings that are being adapted for the use of dwelling also come under a residential property. Additionally, Land that forms part of a garden or grounds of a building suitable for dwelling also finds itself underneath the residential property sector. The residential property market is made up of 6 main categories.

These six categories include:

  • Residential accommodation for school pupils
  • Residential accommodation for students (this does not include hall of residence for students in further or higher education)
  • Residential accommodation for members of the armed forces
  • Houses/flats
  • Holiday homes

All these different types of commercial buildings are divided into classes under the town and country planning order of 1987, this determines how each of the commercial property types should be occupied. Each commercial building has its use defined by the local authority and any business that isn’t in line with the building’s use could result in a fine.

So what’s the difference?

Residential properties are buildings that are used or suitable to be used as a dwelling, whereas commercial are those that are used for business. However, some other differences are not so obvious, firstly, the customers are different for both types, for example, for residential properties, they’re called tenants and they pay a fixed monthly amount to live in a property.

Alternatively, for commercial properties, the main type of clientele are business owners and companies. Secondly, the materials used for residential properties and commercial are very different. You will find that residential tend to use timber frame construction because it is not only more cost-effective but also much more suitable to these smaller buildings.

Commercial projects tend to have much larger, more complex design requirements that therefore demands different material. This results in commercial properties using steel as it is more resilient and allows for larger and taller buildings with longevity.

Finally, the cost of commercial and residential properties is different you will discover that commercial properties can often be more expensive in comparison to residential properties. This is due to commercial properties requiring more on-site maintenance and also tend to have larger plots of land compared to residential properties.

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