Introduction to real estate and ownership interest Flashcards
Real estate
Land and attatchments
Type of property that can generally be moved from one location to abother, (i.e., it is not attached to real property or land), touched or felt. It is not real estate.
Personal Property.
Examples include items such as furniture, clothing, jewelry, art, writings, or household goods.
All things attached to the land and all rights inherent with that land. As a general rule it relates to things that are immovable.
Real Property
Why is real estate considered a commodity?
Because it has utility and it is marketable in its own specialized area. “location, location, location.”
List the Bundle of Rights
- Possess
- dispose
- use
- exclude others
Physical concept of land
Solid surface of the earth. (i.e.”dirt”, improvements, in most cases bricks and sticks)
What are some examples of Improvements to the land
land development, utilities
Relates to the intention of the party making the annexation, whether the item can be removed without substantial damage to the realty, and whether the item can be removed without substantial damage to the item itself.
Fixture requirements
Items of property that a tenant uses in the conduct of its business and that remain personal property, even though they have the other characteristics of fixtures.
Trade fixture
How does personal property become a fixture?
M - Method of attatchment
A - Adadptability
R - Relationship of the party
I - Intention of party when iten was attatched
A - Agreement between the parties.
Examples of fixtures
- Refrigeration systems.
- Presses of a newspaper business.
- Garage.
- Pump on concrete foundation.
- Sewer line embedded in soil and not removable without serous damage to the entire sewer line.
- Computer hardware.
- Drapes and wall to wall carpeting.
What ate the 3 legal rights obtained when owning land?
- Surface rights
- Mineral (subsurface) rights - beneath land.
- Air rights - limits are no more than 20,000 feet below ground and 1500 feet above ground.
Rights that go from the surface of the land into space. It is possible to purchase land that has limited air rights. An example would be not owning the rights above 50 feet. This would stop you from building anything higher than 50 feet. A previous owner may have retained the air rights higher than 50 feet to keep the view from being blocked.
Air rights
What we typically think of as land ownership. The owner has the right to use the surface, build on it, farm it, or use the land for any legal purpose.
Surface rights
Ownership of anything below the surface. Includes gravel, oil, gas, gold, etc,. Includes the right to use the surface as necessary to access the minerals.
Mineral (subsurface rights)
The rights of property owners who own land abutting rivers and streams. owners of property that abuts a river or stream have a right to use the water, but they don’t have any right to contaminate the water or interrupt or change the flow of the water.
Riparian rights
The rights commonly granted to owners of property that border a bay, a large lake, the ocean, or a sea. Owners of property abutting such bodies of water have an unrestricted right to use the water and ownership of the land up to the average or mean high water mark.
Littoral rights
Financial rights
- Right to make money off of the property - (i.e. rent property).
- Right to mortgage the property - (i.e. borrow money against it).
An estate in which ownership is for an undefined length of time. Must include ownership of real estate and last for an indefinite period of time.
Freehold estate
What are the two main types of freehold estates?
Fee estates and life estates
The most complete form of ownership without limitations on rights of ownership, except for public and private restrictions on what can be done with the property.
Fee simple estates
What is the main difference between a fee simple estate and a life estate?
Fee simple estate has no time limit and a life estate does.
Ownership that lasts only as long as the owener is alive. The property transfers back to the original owner at deather through “reversion”. The designated future owner has a “remainder” interest and will eventually own the property fee simple.
Life estate
Which right, of the bundle of rights, does a life estate not have?
The right to dispose of the property.
If no restrictions are placed on an owener that owns his estate fee simple, does this mean they can do anything they want to the land?
No, government restrictions such as zoning prevent a fee simple owner from doing whatever they want with the land.
Right of a spouse, entitling him or her to one half interest in real property that was acquired during a marriage.
Community property
The right of a husband to a portion of real property that is owned by his wife — after she dies and even if she leaves it to someone else in her will.
Curtesy
The right of a wife to a portion of real property that is owned by her husband — after he dies and even if he leaves it to someone else in his will.
Dower
Grants the family home a certain level of protection from creditors during the owner’s lifetime
Homestead
Interest in real estate that gives some rights to the tenant, such as a right to exclusive possession and use of all or some portion of the property, while the owner retains ownership rights, the right to collect rents, and the right to sell the property. The estate is for a definite duration.
Leasehold Estates
The ownership of real property in which several owners each own a stated portion or share of the entire property. Each owner can owne a different percentage, can take title at any time, and can sell interest at any time.
Owner A - 50%
Owner B - 30%
Owner C - 20%
If B dies his percentage owenership goes to his heirs not to A or C.
Tennancy in common
Means that you share ownership of property. when you die, the other co-owner receives your share of the property by right of survivorship.
Joint Tennancy
In order for one spouse to modify his or her interest in the property in any way, the consent of both spouses is required by tenants by entirety. It also provides that when one spouse passes away, the surviving spouse gains full ownership of the property. (e.g. Dower, Curtesy)
Tennancy by the entirety
May hold an owner liable for the unpaid operating expenses of other owners.
Cooperative
Form of group ownership that involves actually getting a deed to your individual ownership interest. The deed describes the airspace you own, which you own as a tenant in severalty, and your share as a tenant in common of the land under and around your unit. A homeowners association usually collects set monthly fees, which pay for maintenance of the condominium building and complex.
Condominium
Timeshare
A person has either a fractional ownership in a property or the right to use a property for a limited period of time each year or both.
A large development often having mixed uses, such as different types of residential and commercial uses, and built by a single developer.
Planned Unit Development (PUD)
What is the difference between a condominium and a PUD?
The owner of a PUD unit also owns land beneath it. In a condominium, you own the unit individually but the land under and around it as a tenant in common with others. You usually own land in a PUD.
Means in your home state. Originally a term used to describe two- or three-story attached housing in urban areas, and they are usually located in planned unit developments.
“Townhouse”
Types of real estate professionals
Real Estate Agent, Broker Investors Urban Planner Developer, Contractor, Subcontractor Property Manager, Asset Managet Real Estate Attorney or Title Issuer Mortgage Banker, Orginator, Underwriter Appraiser, Tax Assessor
Air right limits are no more than ______ feet below ground and _______ feet above ground.
- 20,000 ft below
2. 1,500 ft above ground
One difference between a cooperative estate and a condominium estate is that?
A default by a coop owner may cause a foreclosure on the entire property instead of just a single unit as with a condominium.
When a tenant in common dies what happens to the tenants interest in the estate?
Passes to the deceased tenants heirs.
Condominium owner can?
Sell or mortgage the unit without hindrance from individual owners of neighboring units.
Owner owns shares in a corporation or association and a proprietary lease I. A physical unit.
Cooperative owner
The type of estate where the duration of the owner’s rights cannot be determined?
Freehold estate
Type of estate that is distinguished by its specific duration, as represented by the lease term?
Leasehold estate
The prime example of public interest or the right of the local or county government to zone is?
Police Power
If a private interest-holder does not have the right to possess, the interest is an?
Encumbrance
County and local governments have the power to:
County and local governments have the power to: Zone land, take over land for the public good, issue building permits, and establish the rules for all development projects.
County and local government regulation focuses on what?
Land use control, improvements, and taxation
Trade fixtures, emblements and conversions by severance are what kind of property?
Personal Property
Land, fixtures, attachments and conversions by affixing are what kind of property?
Real Property
The act of converting personal property to real property by attaching it to the real estate.
Affixing or attachment
The conversion of real property to personal property by detaching it from the real estate.
Severance
Items of a tenant’s personal property that the tenant has temporarily affixed to a landlord’s real property in order to conduct business.
Trade Fixtures
An item is uniquely adapted to the property, or the property is custom-designed to accommodate the item.
Adaption
If an item is vital to the operation of the building.
Functionality
Under Riparian Rights the ownership of a navigable waterway:
Extends to the water’s edge.
Under Riparian Rights the ownership of a non-navigable stream:
Is the land beneath the stream to the stream’s midpoint.
Under Littoral Rights the ownership:
Extends to the high-water mark of the body of water.
Rights concerning the rights to own and use water in lakes, streams, rivers, and the ocean.
Water rights
Rights that apply to the real estate contained within the surface boundaries of the parcel.
Surfae rights
Rights that apply to the space above the surface boundaries of the parcel, as delineated by imaginary vertical lines extended to infinity.
Air rights
Man-made structures attached to land are?
Improvements
In common understanding, what is something that is owned by someone?
Property
The legal concept of land encompasses?
The surface area of the earth
Everything beneath the surface of the earth extending downward to its center.
All natural things permanently attached to the earth
The air above the surface of the earth extending outward to infinity.
A simple definition of real estate is?
Air, water, land, and everything affixed to the land.
Name the 4 property type agents
Residental
Commercial
Industrial
Land
A seller, buyer, landlord or tenant hires this person to procure the opposite party to the sale or lease transaction.
Broker
Property that is held by its owners for investment purposes.
Investment Property
Property that refers to retail and office properties, and industrial real estate.
Commercial Property
Property that is owned and used for habitation.
Residential Property
The Property type specializations are:
- Investment
- Commercial
- Residential
Which is true of a joint tenancy?
The tenants have an equal and indivisible ownership interest.
The most common form of co-ownership when the owners are not married is?
Tenancy in common
Two individuals can own a house as tenants by the entireties if?
They are married
In a cooperative, real property is owned only by?
The corporate entity of the cooperative association.
The distinguishing features of a condominium estate are?
Fee simple ownership of the airspace in a unit and undivided share of the entire property’s common areas.
Upon the death of the owner, a life estate passes to?
The original owner
An interest in real estate is best defined as ownership of?
One or more of the bundle of rights to real property
Under the doctrine of littoral rights, an owner claims ownership of all the land underlying a lake where there are three other abutting property owners. Why would the owner’s claim be invalid?
Because the state owns the underlying land
A grocer temporarily installs special fruit and vegetable coolers in a leased grocery store in order to prevent spoilage. The coolers would be considered what?
Trade fixtures that are personal property
What part of a non-navigable waterway does the owner of an abutting property own?
The middle of the water way
The primary distinction between legal concepts of real estate and real property is that?
Real property includes ownership of a bundle of rights
The primary distinction between the legal concepts of land and real estate is that?
Land does not include man-made structures
Which professionals involved in the real estate business are most concerned about procuring buyers and sellers for clients?
Brokers and agents
People in the real estate business who primarily focus on creating new properties are:
Developers
Which of the following types of ownership estates is the most complete bundle of rights, and therefore carries the greatest value?
Fee simple absolute
An easement is the right to use land for a specific and limited purpose. Type of easement that involves a relationship between two parcels of land, is a permanent feature of both parcels involved, and gives the dominant parcel some intrusive use of the servient parcel?
Affirmative easement appurtenant
