Chapter 26 Estates, Leaseholds, and Regulation of Property.

Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall. 26-1

Chapter 26

Estates, Leaseholds, and Regulation of Property


What is Real Property?

The land itself as well as buildings, trees, soil, minerals, timber, plants, and other things permanently affixed to the land


Forms of Real Property Land and buildings

Land is the most common form – surface rights

Buildings constructed on land are also considered real property.

Subsurface rights Mineral rights beneath

the land surface


Forms of Real Property

Plant life and vegetation Growing plants are considered real

property. Includes natural and cultivated plants

Fixtures Goods that have been affixed to real

property


Estates in Land

Freehold estate – owner has a present possessory interest in real property

Estates in fee Fee simple absolute

Highest form of ownership Owner has right to exclusive possession and use.

Fee simple defeasible Ownership may be taken away if a specified

condition occurs or does not occur.


Estates in Land Life estate

Interest in property lasts for the life of a specified person.

Tenant has the right to possess and use the property during the term of the life estate.


Concurrent Ownership Joint tenancy

Deceased tenant’s interest automatically passes to surviving co-tenants.

Tenant may transfer his or her interest without consent of co-tenants.

Tenancy in common Deceased tenant’s interest passes to his or her

estate. Tenant may transfer his or her interest without

the consent of co-tenants.


Concurrent Ownership Tenancy by the entirety

Deceased tenant’s interest automatically passes to his or her spouse.

Neither spouse may transfer his or her interest without the other spouse’s consent.

Community property Surviving spouse automatically receives 1/2 of

community property; other 1/2 passes to heirs. Neither spouse may transfer his or her interest

without the other spouse’s consent.


Multiple-Dwelling Buildings Condominium

Purchasers have title to individual units.

Common areas are owned as tenants in common with other owners.

Cooperative A corporation owns the

multiple-dwelling building and residents own shares in the corporation.


Future Interests Future interest – the interest that the

grantor retains for himself or herself or a third party Reversion

Right to possession of real property returns to the grantor after the expiration of a limited or contingent estate.

Remainder Right to possession of real property goes to a third

person upon the expiration of a limited or contingent estate.


Transfer of Ownership of Real Property

Sale or conveyance Deed describes ownership

interest. Deed is delivered at

closing or settlement. Recording statutes

Deed or mortgage should be filed in county recorder’s office.

Recording gives “constructive notice” of owners’ interest in the property.


Transfer of Ownership of Real Property

Adverse possession A person who wrongfully possesses

another person’s land may obtain title to the land.

Requirements Possession for the statutory period of time Open, visible, notorious Actual and exclusive Continuous and peaceful Hostile and adverse


Nonpossessory Interests in Real Property

An easement is an interest in land that gives the holder the right to limited use of another’s real property. Easement appurtenant

Easement over a servient estate that benefits a dominant estate

Easement in gross Easement that grants a

person a right to use another’s land


Nonpossessory Interests in Real Property

License Grants a person the right to enter

upon another’s real property for specified event or time

Profit Grants holder the right to remove

something from another’s real property


Landlord-Tenant Relationship A relationship created

when the owner of a freehold estate (landlord) transfers a right to exclusively and temporarily possess the owner’s property to another (tenant)


Types of Tenancies

Tenancy for years Continues for the duration of the lease and

then terminates automatically without notice

Periodic tenancy Continues from payment interval to

payment interval May be terminated by either party with

adequate notice


Types of Tenancies Tenancy at will

Continues at the will of the parties and may be terminated by either party at any time with adequate notice.

Tenancy at sufferance Arises when a tenant wrongfully occupies real

property after the expiration of another tenancy or life estate.

Continues until the owner either evicts the tenant or holds him or her over for another term.


The Lease Rental agreement

between landlord and tenant

Statute of Frauds requires that leases for longer than one year be in writing.


Implied Warranty of Habitability

Leased premises must be fit, safe, and suitable for ordinary residential use.

If the warranty is breached, a tenant generally may: Withhold from his or her rent the amount by

which the defect reduced the value of the lease Repair the defect and deduct the cost from

rent Cancel the lease Sue for damages


Zoning Functions of zoning ordinances

Establish use districts Restrict height, size and location of buildings on a

site Establish aesthetic requirements for buildings

Variance – permission to use property for different use than permitted under zoning

Nonconforming use – continuing to use property in the way it was used before the zoning was changed, even though the use does not fit with the ordinance


Eminent Domain The right of the government to acquire

private property for public use The Due Process Clause of the U.S.

Constitution allows an owner to make a case for keeping the property.

The Just Compensation Clause of the 5th Amendment to the U.S. Constitution states that the government must compensate the property owner when it exercises its power of eminent domain.

Chapter 26 Estates, Leaseholds, and Regulation of Property.

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Transcript of Chapter 26 Estates, Leaseholds, and Regulation of Property.