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Why are leasehold interests classified as personal property in common law?

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Oil portrait of Hugo de Groot, also known as Hugo Grotius, by the workshop of Michiel Janszoon van Mierevelt, showing him with a ruffled white collar and dark clothing. — Property law Portrait of Hugo de Groot (Hugo Grotius), oil on panel by the workshop of Michiel Janszoon van Mierevelt, 1631; in the Rijksmuseum, Amsterdam.

In English common law, the classification of leasehold interests as personal property—specifically as chattels real—stems from the historical development of property law during the feudal era.1

While most interests in land and permanent buildings were categorized as real property (or "real estate"), leasehold interests were treated differently. Because a leasehold was viewed as a contractual agreement between a landlord and a tenant for the exclusive possession and use of property for a specified period, it did not carry the same status as a freehold estate in land.12

Historically, common law courts distinguished between "real" actions, which allowed a person to recover the land itself, and "personal" actions, which provided compensation for the loss of an interest. Because a tenant originally lacked the same legal remedies to recover possession of land as a freeholder, their interest was classified as a personal property interest—a "chattel real"—rather than real property. This classification persists today, even though the distinction between real and personal property has become less significant in modern legal systems.1