Real vs. Personal Property Flashcards
What is Real Property?
Land plus appurtenances that benefit the land.
Define Appurtenances
Appurtenance means “belongs to or goes with”. They are things that transfer with the land when the land is transferred to another owner, such as improvements, rights, privilege’s, and fixtures.
What are the 4 appurtenant rights?
- Surface Rights
- Subsurface Rights
- Air Rights
- Mineral Rights
What is Personal Property?
Also referred to as “chattel”, is everything owned that is not real property and must be included in the sale contract if the buyer wishes to receive it.
Are trees, bushes, house, garage, water, and the rights of ownership an appurtenant?
Yes, because all of those are permanent, belongs to and goes with the land. They all will be transferred over to the new owner.
Economic Characteristics of Real Property are?
- Scarcity
- improvements
- permanence of investment
- location
Define Scarcity
the supply of land is not limitless (shortage) hence the word “scarce”. Land at a given location, or of a particular quality is scarce.
Define improvements
an improvement built on a parcel of land that affects the lands value and use. Example: renovating or adding buildings or structure
Define permanence of investment
The capital and labor required to build an improvement may be a large investment, the return on an investment tends to be long and stable.
Define location in economic characteristics
Sometimes called “area preference” and/or “situs”, location refers to people’s preferences of an area based on its history, reputation, scenic beauty, and convenience.
Physical Characteristics of Real Property are?
- immobility
- indestructibility
- uniqueness
Define immobility
Geographic location of any given parcel of land can never be changed. It is fixed and therefore immobile (motionless, unmovable)
Define indestructibility
Land is considered indestructible, the permanence of land tends to make investments in real property relatively stable. However, improvements on land can depreciate and reduce the land’s value.
Define Uniqueness
Also known as “nonhomogeneity”, Uniqueness is the concept that no two parcels of land are alike or in the same location. Each parcel is geographically distinct.
An owner may transfer these rights to another party while still retaining surface rights to the land itself.
Mineral and Air Rights
Explain Water Rights
owners of land adjacent to rivers, lakes, or oceans have special common-law rights.
Where water is plentiful, states may rely on the simple parameters set by the common-law doctrines of Riparian & Littoral Rights
Where water is scarce, a state may control all but limit domestic use of water according to Doctrine of Prior Appropriation.
Define Riparian Rights
Rights granted to owners of land along the course of a stream, river, or similar body of water. Owners has unrestricted rights to use the water as long as the owner does not interrupt or alter the flow of the water or contaminate it in any way.
Define Littoral Rights
Rights granted to owners of land that border a standing body of water like lakes, seas, and oceans. Owners has unrestricted rights to use the water but only up to the average high-water mark.
Are Water Rights appurtenant?
Yes, because it’s part of the land and once it is sold and transferred to a new owner so does the water rights.
Define Doctrine of Prior Appropriation
Rights to water use is restricted when water is scarce with the exception of limited domestic use that’s controlled by the state, therefore landowners who want to use the limited amount of water must demonstrate to a state agency owners plans for the water use is for beneficial use, such as crop irrigation.
Personal Property is…
Movable and not permanent like real property. it includes things such as chairs, tables, clothing, etc.
Manufactured housing that is not permanently affixed to the land is…
Real property or Personal property?
Personal Property because it said it is not affixed to the land.
If it is movable it is Personal Property unlike Real Property where nothing can be movable because it is a part of the land.
Define emblement
an annually growing crop, such as corn or grapes, that is produced and picked at harvest.
Is emblement considered Real Property cause it’s attached to the land?
No, emblements are regarded as Personal Property
If a tenant is growing crops on a leased land does the tenant have the right to harvest it even after the lease is terminated?
Yes, the crop is the tenants personal property and a landlord cannot terminate a lease without giving the tenant the right to enter the land to harvest any crops belonging to the tenant.
How can a Personal Property become Real Property?
If the personal property becomes a Fixture.
Define Fixtures
is Personal Property that has been affixed or attached to land or to an improvement so that it becomes a part of the Real Property, such as heating systems, kitchen cabinets, light fixtures, and plumbing.
Can Fixtures be transferred with the property once sold?
Yes unless the contract specifically excludes them.
Define Trade Fixtures
Property owned by a tenant, attached to a rented space or building and used in conducting a business, such as hydraulic lifts in an auto shop, dining booths in a restaurant, and Agricultural fixtures such as chicken coops and tool sheds are also Trade Fixtures.
What’s the difference between a Fixture and a Trade Fixture?
Fixture is Personal Property that has been made a part of the Real Property. While Trade Fixtures can be removable by tenants on or before the last day the property is rented, if they are not removed it will then become the real property of the landlord.
Define Annexation in regards of Fixtures
How permanent is the method of attachment? and can it be removed without causing damage to the surrounding property or can the damage caused by the removal be easily repaired.
Define Adaptation in regards of Fixtures
is the item used as real property or personal property? for example: a refrigerator is considered personal property, however if a refrigerator has been adapted to match the kitchen cabinetry it may be considered a fixture.
Define Agreement in regards of Fixtures
Have the parties agreed to whether a particular item is real or personal property?
Define Bill of Sale
an item of personal property that is transferred through a bill of sale and is not a part of a real estate purchase and sale agreement.
