If envy is sadness at the sight of ones goods,
Envy is not a sadness; it is a malicious feeling, an ill will, a feeling of resenting the other’s endowments or possessions or circumstances. In plainer terms: envy is something akin to hoping that the other will lose whatever good they have.
do the goods need to Be objects
No, the envied goods don’t have to be objects. They could be circumstances. One can even envy another’s mental state, e.g. happiness, regardless of the reason.
does it need to be that we are sad that they have the good to be envy or is it envy even if we are just sad that we don’t have it?
If you are just sad that
you don’t have a certain thing, that does not constitute envy. It is only envy when ill will arises toward another human being because he or she
does have it.
Also what is meant by it being a “capital sin”
A capital sin is a sin that is “fundamental”, i.e. it forms (or
can form) the basis of other sins. The RCC currently recognizes seven capital sins that appear on a
shortlist. (They’re called
deadly sins in the linked article, but they are the same as the
capital sins.) In any case, “capital” does not necessarily mean that these sins are
worse than other sins. It means that they are “elementary”, i.e. the form a basis from which other sins can grow or emerge.