1. Real Estate Principles Tenth Edition Real Estate: An Introduction to the Profession Tenth Edition

2. Chapter 3 Rights and Interests in Land ____________________________

3. Exclusive Right to Use of Land Feudal System Allodial System

4. The Fee Simple Bundle of Rights Real estate ownership is, in actuality, the ownership of rights to land. The largest bundle available for private ownership is called “fee simple.”

5. Real Estate as a Bundle of Property Rights Property rights are what gives value to the real estate. Private property rights are subject to limitations imposed by government. Thus, this can limit the value of the investment.

6. Government Limitations The right of government to regulate private property for the protection of the general public’s health, morals, and welfare. Further discussion in Chapter 25 Police Power

7. Government Limitations (continued) The right of government to take private property for public use upon payment of just compensation. Eminent Domain

8. Government Limitations (continued) The right of government to tax private property Further discussion in Chapter 15. Taxation

9. Government Limitations (continued) Ownership of property passes to the government if there is no will or no heirs. Escheat

10. Removing Sticks from the Fee Simple Bundle Note that the fee simple bundle shrinks as an owner voluntarily removes rights from it.

11. Real Estate as a Bundle of Property Rights Right or BenefitStick in Bundle Control Mortgage Lease Impose covenants or conditions Grant easement Grant license Build or remove structures Use & Enjoy Occupy as residence Use as place of business Farm Mine/drill for oil, etc. Place of recreation Exclusion Maintain privacy Non-trespass Disposition Sell or refuse to sell Give Will Abandon

12. Commonly Found Easements

13. Commonly Found Encroachments

14. Other Estates Qualified Fee Estates Life Estates Statutory Estates Freehold Estates Leasehold Estates

15. Rights and Interests in Land

16. Cross Section of Estates and Rights in Land

17. Cross Section of Estates and Rights in Land (continued)

18. Checkpoint In the absence of any other factors, which bundle of rights has a higher value?

19. Key Terms Chattel Easement Eminent domain Encroachment Encumbrance Estate Fee simple Lien Title