Real Estate Foundations Flashcards
Define what is Real Estate? What are the differences between real and personal property? What are the characteristics of land and land rights?
There are 3 terms in real estate that appear to be interchangable but have subtle differeneces, what are they?
The 3 terms in real estate that appear to be interchangable are land, real estate and real property.
What is the definition of real estate?
Real estate is the land plus improvements.
Improvements would include buildings, fences, roads and decks.
Improvements MUST be permanently attached to the land. Otherwise, they’re what is known as personal property
What is real property?
Real property refers to the land, improvements and the BUNDLE of rights associated with real estate ownership.
Land + Improvements + Bundle of rights = Real property
What are the bundle of rights associated with owning real property?
The bundle of rights associated with owning real property include:
the right of possession
the right of use
the right to transfer (disposition)
the right of exculusion
the right to encumber
BONUS, the covenant of quiet enjoyment
Remember the acronym “PUTEE”!
What is the right of possession in reference to the bundle of rights?
The right of possession basically means that the buyer offically has ownership of the property.
What is the right to use in reference to the bundle of rights?
The right to use allows the buyer to use the property as they wish, as long as its legal.
Ex: landscaping, renovations having guests over, etc.
What is the right of transfer in reference to the bundle of rights?
The right to transfer allows you to sell, lease, or will your property to anyone you choose, either fully or partially. You can transfer your property at any time, to anyone, and for any amount agreed upon. This is also known as the right of disposition.
What is the right of exculsion in reference to the bundle of rights?
The right of exclusion gives an owner the right to tell trespassers (or anyone!) to get off their land. When you own real property, you can exclude anyone you care to from entering it or deny them the use of it.
What is the right to encumber in reference to the bundle of rights?
The right to encumber gives an owner the right to use the property as collateral for a debt.
Common law is…
the side of law that arises from judgments and decisions made in courts rather than explicit legislation.
Plants as Property
What is the difference between fructus naturales and fructus industriales?
Fructus naturales, or long-term decorative and uncultivated plants, are usually deemed real property due to their permanence.” “Fructus industriales, or emblements, are annually cultivated crops typically regarded as personal property even before harvest.”
What 3 methods of affixation can create fixtures?
Close Association- conceptual linkage to real property
Agreement- have it in writing
Adoption- customization of personal property for use with real property
What is a trade fixture?
A trade fixture is a business-related fixture owned by a tenant, such as a shelf or display case, which the tenant can remove when leaving the premises.
What is severence regarding real estate?
Severance is the act of converting real property into personal property. You could say, then, that severance is the opposite of affixation.
How to determine whether or not something is a fixture?
MARIA
Method of Attachment -Will it damage the property if I remove this item?
Adaptability - Is this item specifically adapted for this home?
Relationship to the parties -Who installed this item?
Intent - Who bought this item? Were they intending on keeping it after?
Agreement - What does the contract have to say about the item?
