Chapter 25. The land itself as well as buildings, trees, soil, minerals, timber, plants, and other...

Chapter 25

The land itself as well as buildings, trees, soil, minerals, timber, plants, and other things permanently affixed to the land

Land and buildings Land is the most common form of real property▪ A landowner usually purchases the surface rights to the land

Buildings constructed on land are real property

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. 25-2

Rights to the earth located beneath the surface of the land

Plant life and vegetation Plants growing on the surface of land that are considered

real property Fixtures

Goods that are affixed to real estate so as to become part thereof

Air rights: Rights to air space parcels above their land that the owners of land may sell or lease


Ownership rights in real property The bundle of legal rights that an owner has to possess, use,

and enjoy the property Freehold estate

An estate in which the owner has a present possessory interest in the real property

The owner may use and enjoy the property as he or she sees fit, subject to any applicable government regulation or private restraint


A situation in which two or more persons own a piece of real property

Right of survivorship A legal rule which provides that upon the death of one joint

tenant, the deceased person’s interest in the real property automatically passes to the surviving joint tenant or joint tenants


Form of Ownership

Right of Survivorship Tenant May Unilaterally

Transfer His or Her Interest

Joint tenancy Yes, deceased tenant’s interest automatically passes to co-tenants.

Yes, tenant may transfer his or her interest without the consent of co-tenants. Transfer severs joint tenancy.

Tenancy in common

No, deceased tenant’s interest passes to his or her estate.

Yes, tenant may transfer his or her interest without the consent of co-tenants. Transfer does not sever tenancy in common.


Form of Ownership

Right of Survivorship Tenant May Unilaterally

Transfer His or Her Interest

Tenancy by the entirety

Yes, deceased tenant’s interest automatically passes to his or her spouse.

No, neither spouse may transfer his or her interest without the other spouse’s consent.

Community property

Yes, when a spouse dies, the surviving spouse automatically receives one-half of the community property. The other half passes to the heirs of the deceased spouse, as directed by a valid will or by state intestate statute if there is no will.

No, neither spouse may transfer his or her interest without the other spouse’s consent.


A common form of ownership in a multiple-dwelling building Purchasers of a condominium▪ Have title to their individual units

▪ Own the common areas as tenants in common with the other owners Cooperative

A form of co-ownership of a multiple-dwelling building in which:▪ A corporation owns the building and the residents own shares in the

corporation


The interest that a grantor retains for himself or herself or a third party

Reversion: A right of possession that returns to a grantor after the expiration of a limited or contingent estate

Remainder: A right of possession that returns to a third party upon the expiration of a limited or contingent estate A person who possesses this right is called a remainder

beneficiary


Sale (conveyance): The passing of title from a seller to a buyer for a price It is the most common method for transferring ownership

rights in real property A real estate sales contract is executed by the parties▪ Statute of Frauds – the contract must be in writing

The seller delivers a deed to the buyer The buyer pays the purchase price at the closing, or

settlement


An instrument that describes a person’s ownership interest in a piece of real property Grantor: A party who transfers an ownership interest in

real property Grantee: A party to whom an interest in real property is

transferred General warranty deed (grant deed)

A deed that protects a grantee of real property from defects in title caused by the grantor and prior owners of the property


Special warranty deed (limited warranty deed) A deed that protects a grantee of real property from defects

in title caused by a grantor The seller is not liable for: ▪ Defects in title that existed before the seller obtained the property

▪ Encumbrances that were present when the seller obtained the property

Quitclaim deed A deed in which a grantor of real property transfers

whatever interest he or she has in the property to a grantee


A state statute Requires a mortgage or deed of trust to be recorded in the

county recorder’s office of the county in which the real property is located

Recording the deed gives constructive notice to the world of the owner’s interest in the property


An action brought by a party, seeking an order of the court declaring who has title to disputed property The court “quiets title” by its decision

Adverse possession A situation in which a person who wrongfully possesses

someone else’s real property obtains title to that property if certain statutory requirements are met


Most states require that the wrongful possession be: For a statutorily prescribed period of time Open, visible, and notorious Actual and exclusive Continuous and peaceful Hostile and adverse


A situation in which a person holds an interest in another person’s property without actually owning any part of the property

Easement A given or required right to make limited use of someone

else’s land without owning or leasing it


The following types of easements may be created Easement by grant Easement by reservation Easement by implication Easement by necessity Easement by adverse possession



Landlord(Lessor)

Tenant(Lessee)

Lease

Owner-landlord owns titleto the real property

Tenant acquires a nonfreehold estate

in the real property that

gives the tenant a right to possession

of the property

A warranty which provides that leased premises must be fit, safe, and suitable for ordinary residential use

Rent control ordinances: Local laws that stipulate the amount of rent a landlord can charge for residential housing


A federal statute Prohibits discrimination in the selling and renting of

property based on race or color The law applies to▪ All rentals of public and private property

▪ Property owners renting separate units within a dwelling in which they live

▪ Persons renting out space in their own homes


A federal statute Makes it unlawful for a party to refuse to sell, rent, finance,

or advertise housing to any person because of his or her▪ Race

▪ Color

▪ National origin

▪ Sex

▪ Religion

▪ Disability

▪ Familial status


The law does not apply to the following A person who owns a building of four or fewer units and

occupies one of the units and leases the others A person who leases a single-family dwelling and does not

own more than three single-family dwellings The act is administered by the U.S. Department of

Housing and Urban Development (HUD)


A federal statute Prohibits discrimination against disabled individuals in

employment, public services, public accommodations and services, and telecommunications

Amended by Americans with Disabilities Act Amendments Act of 2008 (ADAAA)

Title III of the ADA: A section of a federal statute Prohibits discrimination on the basis of physical or mental

disability in places of public accommodation operated by private entities


State and local governments may provide: fair housing laws that prohibit discrimination in housing

Zoning Zoning generally▪ Establish land use districts within the municipality

▪ Restrict the height, size, and location of buildings on a building site

▪ Establish aesthetic requirements or limitations for the exterior of buildings


Zoning ordinances: Local laws that are adopted by municipalities and local governments to: Regulate land use within their boundaries

Zoning commission Formulates zoning ordinances Conducts public hearings Makes recommendations to the city council▪ City council votes to enact an ordinance


Variance: An exception that permits a type of building or use in an area that would not otherwise be allowed by a zoning ordinance

Nonconforming uses: Uses for real estate and buildings that already exist in a zoned area The buildings are permitted to continue even though they

do not fit within a new zoning use established for the area


Due Process Clause: A clause of the U.S. Constitution that allows the government to take property for “public use” Eminent domain: The government’s power to take private

property for public use, provided that just compensation is paid to the private property holder


Just Compensation Clause: A clause of the U.S. Constitution Requires the government to compensate the property

owner, and possibly others, when the government takes property under its power of eminent domain


Chapter 25. The land itself as well as buildings, trees, soil, minerals, timber, plants, and other...

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