Real Property and the Law

Land v. Real Estate v. Real Property Land – earth’s surface (down to center of earth and up to infinity) and thing’s naturally, permanently attached to it. (trees, rock formations, etc.) Land – earth’s surface (down to center of earth and up to infinity) and thing’s naturally, permanently attached to it. (trees, rock formations, etc.) Real Estate – includes things permanently attached, whether natural or man-made. Real Estate – includes things permanently attached, whether natural or man-made. Real Property – interests, rights, and benefits included in ownership of land and real estate. Real Property – interests, rights, and benefits included in ownership of land and real estate.

What rights are included? possession possession control control enjoyment enjoyment exclusion exclusion disposition disposition (all within boundaries set by law) (all within boundaries set by law)

Questions... What does it mean to have title to a piece of property? What does it mean to have title to a piece of property? What document provides evidence of your title to a property? What document provides evidence of your title to a property? Why would you be concerned that your ownership extends into the earth? Why would you be concerned that your ownership extends into the earth? What about into the air? What about into the air?

Real Property v. Personal Property This is one of the toughest distinctions you will have to make. This is one of the toughest distinctions you will have to make. Why is it important? Why is it important? Some examples Some examples mobile home crops and trees air conditioner Severance and Annexation Severance and Annexation

What is a fixture? Personal property that has been so affixed to the land or a building that, by law, it becomes part of the real property. Personal property that has been so affixed to the land or a building that, by law, it becomes part of the real property. Legal tests of a fixture: Legal tests of a fixture: Method of attachment (annexation) Adaptation Agreement (intent of the parties) Trade fixtures Trade fixtures

Characteristics of Real Property Economic characteristics: Economic characteristics:scarcityimprovements permanence of investment location Physical characteristics Physical characteristicsimmobilityindestructibilityuniqueness

Laws Affecting Real Estate See book for details See book for details Real estate licensees must be very careful about “practicing law” when working on a transaction. Real estate licensees must be very careful about “practicing law” when working on a transaction. Also, other people are prohibited from acting as a real estate licensee. Also, other people are prohibited from acting as a real estate licensee. Note: don’t confuse the terms Realtor ® with that of licensee. Note: don’t confuse the terms Realtor ® with that of licensee.