Is zakat obligatory on personal possessions such as cars and houses?

Scholars divide wealth into two categories: naqd (currency), which is gold and silver, and what is equivalent to them like paper currencies, and this is subject to zakat under its conditions. The second category is ‘arḍ (goods/assets), which includes anything a person owns that has value other than currency, such as real estate and movable goods. This is not subject to zakat unless it is intended for trade. As for assets that a Muslim acquires for personal use or to benefit from their profits without selling them, there is no zakat on them, by scholarly consensus. It was narrated from the Prophet, peace and blessings be upon him: "There is no sadaqah (zakat) on a Muslim concerning his horse or his slave," which is a foundational principle that personal possessions are not subject to zakat.