Nature and Description of Real Estate; Rights and Interests in Land BA 365 January 20, 2005

Daily Trivia Q: What is the most-visited historic home in the United States? A: More than 600,000 visitors a year visit Graceland in Memphis, TN, home of Elvis Presley

Nature and Description of Real Estate What is property and what kind of rights can someone hold? What relationships exist between buyers and sellers of real estate? Water Rights Land Descriptions Physical descriptions of land

What and How Real estate is land and the improvements made to land A person may hold rights to land of the surface, subsurface, and air

Improvements Anything a person does to property that is permanent is carried with the property at time of transfer unless otherwise specified Intention of permanence: The manner of attachment The adaptation of the object The existence of an agreement The relationship of the parties involved

Plants, Trees, and Crops Permanent plants and landscaping stay with the property Crops that are to be harvested are defined legally as emblements, they are personal property

Water Rights Riparian – share use of a single watercourse Doctrine of prior appropriation – the first to divert can keep it Littoral doctrine of capture – first user of water has rights to keep it Percolating water – water not confined to an underground waterway Water table – upper limit of percolating water

Where is it? Describing Land Six methods for describing locations: Informal reference Metes and bounds Rectangular survey system Recorded plat Assessor’s parcel number Reference to documents other than maps

Lot Types Cul de Sac – a street closed at one end with a circular turnaround Flag lot – shaped like a flag or flagpole – used to create a buildable lot out of the land at the back of a larger lot Corner lot – on a corner, usually worth more because of light and access

Lot Types, Cont. Inside lot – a lot with only one street border Key lot – adjoins the side or rear property line of a corner lot T lot – at the end of a T intersection

Characteristics of Land Physical: Land can’t move Land is a durable product, difficult if not impossible to destroy All land is different – one piece can’t be substituted for another Economic: Scarcity of land increases its value Changing land impacts its value and the value of land surrounding it Real estate is a long-term investment Location is important to economic success

Part II – Rights and Interests in Land History Government Encumbrances Estates

History of Land Interests Feudal System – All land ownership rested with the monarchy who awarded small tracts in exchange for crops and military service Allodial System – individuals get to own land and pass it down

Government Rights to Land Property taxes – land used to be the primary source of wealth, its hard to hide Eminent domain – government can take control of land for public projects Police power – zoning, planning, codes, rent control Escheat – government takes control of property in the absence of any heirs

Ownership Why have land if you have no safe way of keeping it? Fee simple – rights of the individual property holder Estate – one’s legal interest or rights in land

Encumbrances Anything that interferes with a person’s rights to their property Easement – one person can use someone else’s land for a special purpose Encroachment – crossing onto another’s property without right

More Encumbrances Deed restriction – private agreements governing the use of land Liens – somebody has a claim to somebody else’s property as collateral

Estates Qualified fee estate – subject to limitations by the person creating the estate Fee simple determinable estate – the duration can be determined from the deed itself Fee simple subject to condition subsequent – the grantor has the right to terminate the estate Fee simple upon condition precedent – title will not take effect until a condition is performed

More Estates Life estate – conveys an estate for the duration of someone’s life Statutory estates – created by state law Dower – both husband and wife must sign over property rights Curtesy – the husband gets rights on the wife’s death, but she may defeat them Community property – each spouse has equal rights to property

Estates, Cont. Homestead Protection – protect homesteaders and their widows or widowers, from losing their property Freehold Estates – tried under real property laws Leasehold Estates – tried under personal property laws