Real Estate

Definitions

Types of Real Property

Land ownership: own property to sky above and downward to center of earth, as well as surface

Immovable: legally and/or physically

Land

Surface of earth to the sky

Natural growth

Minerals in ground

Improvements

Fixtures

Appurtenances

Freehold estate

Types of Personal Property

Movable

Liens (mortgage/trust deed)

Commercial growth

Emblements

Severed mineral rights

Trade fixtures

Leasehold estates

Documents for Real Property

Sale: Deed

Lien:Note

Deed of Trust

Mortgage

Hypothecate:

• pledge thing as security without necessity of giving it up

• give property as security for debt, but not give up posseseion

• pledge property as security for loan, such as in a mortgage

Public Property: property owned by the state

Allodial system: land owned and controlled by individuals

Documents for Personal Property

Bill of Sale: conveys title to personal property

Security Agreement: creates a lien against articles of personal property

Chattel Mortgage: items of personal property rights in personal property are chattel intrests

Property Owner Bundle of Rights

• Right to use, possess, enjoy, dispose

• Air rights

• Subsurface rights

• Mineral rights

• Water rights

  • riparian owner owns land bounding on waterway (river, stream)

  • riparian rights

  • right of owner of real property to use water from adjacent stream or river

  • include right to use reasonable (not unlimited) amount of water

  • not listed in deed or found in public records

  • not all states subscribe to doctrine of riparian rights

• Lease

• Devise

• Encumber

• Grant License

LATERAL SUPPORT

• protection of not having property disturbed by losing support from the side

• law guarantees right to lateral support

SUBJACENT SUPPORT

• protection of not having property disturbed from below

• Rights of ownership, including right to use, possess, enjoy and dispose of a thing in any legal way and to exclude everyone else without rights from interfering

  • includes right to lease, devise, air rights above property

  • does not include right to harvest emblements of tenant farmer or government rights (escheat, tax, eminent domain, police power)

  • one person may own land while another owns air rights or subsurface rights

Fixtures

• Attached

• Built-in

• Type of installation: fixture installed by owner vs. fixtures installed by tenant

• Intent and use by the annexor

• Agreement of parties

  • Tests to determine if item is fixture:

    • manner (method) of annexation

    • (permanence of annexation) - nature of use of adaptation to real estate

    • relationship between parties

    • custom-made aluminum windows, bought, paid for and installed after execution of mortgage, usually a subject to a lien of mortgage

TRADE FIXTURE

• personal property (not permanent part of a building)

• intended to remain property of tenant (not property of owner of real estate)

• removable by tenant (prior to expiration of lease, when lease expires )

• must be removed when lease expires (if not removed, items become property of landlord within reasonable time)

EMBEMENTS

• crops grown on land which require annual planting and cultivation (annual crops)

• right of tenant farmer to go on land to harvest crop

• if lease terminated, by landlord after crop planted, lessee has right to harvest crop

• if farm operated by tenant, crops requiring annual plantings and cultivation are property of tenant

• personal property

GOVERNMENT RIGHTS

Police Power: law, legislation, building codes, environmental and safety hazards.

Eminent Domain: fair compensation, taking, condemnation.

Taxation: Property and personal

Escheat: deceased property owner without a will is intestate, without heirs property goes to the state

ESTATES

Freehold (ownership)

Fee Simple

Absolute

LIFE ESTATE:

• freehold estate (life tenant holds freehold estate), but not fee estate

• can be created by deed or will

• not created by holder of life estate

• use of property for life with provision that title will go to others upon death or not estate of inheritance or life tenant’s heirs have no estate or interest in property

• life tenant responsible for payment of taxes on property

• estate may be for life of tenant or of someone other than life tenant or may extend beyond life of life tenant or if estate is for life of someone other than a life tenant, if life tenant dies while that other person is still alive, estate will vest in heirs or devises of life tenant until death of other person may be measured by life of more than one person

• contract for life estate must be in writing to be enforceable

• life estate may not devise property or commit waste on property Reversionary to Life Tenant (upon death of life tenant) Remainderman