When the Israelites entered the Land of Israel, each tribe was designated a portion, except for the Levites. Instead, each tribe provided cities for them to settle. Should a Levite sell his house, he can redeem it any time in the future – unlike the Israelites who have but a year. However, these rules are obvious from the Torah, and the Talmud begins from the first non-obvious case.
If a regular Jew (Yisrael) inherited a house in the city of the Levites from his maternal grandfather, he redeems it like a regular Jew, only for a year – this is the opinion of Rabbi Yehudah the Prince, who attaches importance to who the seller is. However, the Sages say that he does not have to be a Levi, but rather, all houses in the city of Levites follow the same rules.
Around the cities Torah mandates an open space for a thousand steps for beauty, and another thousand for farming, and these may not be exchanged.
Kohanim and Levites may sell their houses in walled cities and redeem them at any time, their houses never become permanent property of the buyer, who may always be forced by the Levi to sell them back.
Art: Georges Seurat - White Houses, Ville d'Avray