Tag: law

Grasping real estate terminology is crucial for buying or selling property. This blog explores “real property,” discussing its meaning, importance, various types, and distinction from personal property. Let’s dive into this essential concept.

Understanding Real Property: A Definition

Real property, often simply called “real estate,” refers to land and anything attached to it or built on it, including buildings and structures, along with the rights associated with owning the land. This definition may seem straightforward, but there’s more to it when you begin to understand the nuances and implications.

The term “real” in real property is derived from the Latin word “res”, meaning “thing.” Therefore, real property is “real” because it’s physical, tangible, and can’t be moved or lost as easily as other assets. Understanding this can provide you with a deeper insight into why real property is such an important asset class.

Importance of Real Property: The Cornerstone of Wealth

Real property significantly contributes to individual or corporate wealth due to:

• Asset Appreciation: Land generally increases in value over time.
• Collateral for Loans: Real property can secure loans, offering financial flexibility.
• Income Generation: Renting or leasing property generates steady income.
• Tax Advantages: Many countries provide tax benefits for owning and investing in real property.

Classifying Real Property: Breaking it Down

Real property is classified into three main categories:

1. Residential Property: Homes, apartments, townhouses, and vacation properties.
2. Commercial Property: Office buildings, warehouses, retail spaces, and shopping centers.
3. Industrial Property: Factories, mines, farms, and land for manufacturing or extracting minerals.

Real vs. Personal Property: The Critical Distinction

A common confusion is the difference between real and personal property. Personal property is movable and not permanently attached to land. For example:

• A built-in dishwasher in a house is considered real property as it is fixed and integral to the house. On the other hand, a freestanding refrigerator can be easily moved and is therefore personal property.
• A tree growing in the yard is real property as it is permanently attached to the land. However, a potted plant, although it’s living and placed on the property, can be easily moved and is therefore personal property.

This distinction becomes especially important during the sale of a property. Generally, the sale of real property includes the land, the structures built on it, and anything permanently affixed to those structures. However, personal property is usually not included unless specified in the agreement.

The Legal Side of Real Property

When you own real property, you don’t just own the physical land and structures; you also own a bundle of legal rights associated with the property. These generally include:

• Right of Possession: The right to occupy the property.
• Right of Control: The right to control the property’s use within legal limits.
• Right of Exclusion: The right to prevent others from entering the property.
• Right of Enjoyment: The right to enjoy the property as you wish.
• Right of Disposition: The right to sell, rent, or transfer ownership of the property.

Conclusion: Embracing Real Property

Understanding real property and its distinction from personal property is crucial for any real estate endeavor. Whether you’re a real estate agent, first-time buyer, or seasoned investor, this knowledge can prevent costly mistakes.

If you’re considering a career as a real estate agent, real property is just one of many terms to master. Our blog offers in-depth explanations of many real estate terms, and our pre-license course will help you understand them all.

Real property is more than land and buildings; it’s a cornerstone of wealth, an investment opportunity, and a source of income. Whether planning your next big investment or exploring property ownership, remember the importance of understanding real property.

As you delve deeper into the world of real estate, you’ll come across numerous terms that are specific to this field. One term that you’ll encounter frequently is “appurtenances.” While the concept might initially seem overwhelming, it is easy to understand. Moreover, it plays an essential role in property ownership and truthful advertising. This blog post will discuss appurtenances, their definition, and how they relate to the broader real estate profession.

What is the Definition of an Appurtenance?

Appurtenances are additions to a property that have become permanent, such as improvements or rights integrated into the property. These additions are included in the property transaction and are often considered a bonus when buying a house. They are part of the larger entity and cannot be temporary items or personal equipment.

According to the exact definition of appurtenance, they are “property rights or items that are permanent and are passed along with the sale of the property.” By categorizing parts of the property as appurtenances, real estate transactions become much easier since these additions do not have to be separated from the property itself, which can lead to additional paperwork and expenses.

History of Appurtenances in Real Estate

Appurtenances became a defined term in the profession of real estate after the Cohen v. Whitcomb case in 1919. A heated debate occurred about whether a hot water heater, which the tenant installed, would still be owned by them or if it was now part of the property at large. Ultimately, the court decided that the hot water heater, classified as a “repair” and “improvement” to the property, now became a permanent part of the property itself and was technically owned by the landlord.

Can Appurtenances Be Removed?

To classify something as an appurtenance, it must be fixed to the building and not easily removable or replaceable. If removing it would cause significant damage to the property, it is considered an appurtenance. The permanence of the addition is crucial, which is why the term can sometimes be ambiguous.

For example, fences are considered appurtenances because they are fixed to the land, and removing them would damage the soil. In contrast, a baby gate placed by the stairs that can be easily moved is not an appurtenance. Similarly, an antenna attached to a chimney is an appurtenance, as removing it would cause damage.

Examples Of Appurtenances

Common examples of additions and repairs to a home that would be classified as appurtenances include

• Driveways
• Fences
• In-ground Swimming Pools
• Garages
• Barns
• Sheds
• Cabinets
• Septic Tanks
• Ceiling Fans
• Furnaces

An easy way to determine if something is or is not an appurtenance is to recognize whether it can be removed from where it has been placed and if the current owner is able to take this attachment with them when they move to another property. Anything attached via a plug or not built with the intention of being permanent is not considered an appurtenance, such as an above-ground pool designed to be temporary and can be moved without causing damage to the property.

What Is An Appurtenant Easement?

An appurtenant easement refers to someone lending a part of their attached real property to another person for a specific purpose. It is an agreement made between two people to allow an outsider to traverse across parts of their property to get to another destination.

Example: A property owner with a driveway may allow someone else to walk or drive through it to reach another facility. This can sometimes be done without any exchange of money, or the landowner may require a one-time fee for granting access.

Appurtenant easements can include the right to use shared driveways or common areas like parks or swimming pools in a housing community. These easements are typically recorded in the property deed and can impact the property’s value.

Why Are Appurtenances Important in Real Estate?

Appurtenances are crucial in real estate transactions since they can affect the property’s value, ownership, and transfer. When buying or selling a property, it’s essential to consider all the appurtenances attached to it and understand its classification. Failure to recognize an appurtenance can result in legal disputes or additional expenses.

Moreover, appurtenances can also affect the use and enjoyment of the property. For example, suppose an appurtenant easement allows someone to cross through the property at specific times. In that case, it can limit the owner’s privacy and restrict the use of the property.

Summary

Appurtenances are permanent additions to a property, such as improvements or rights that become part of the larger property entity. They cannot be temporary items or personal equipment. Appurtenances can impact the property’s value, ownership, and transfer, making it essential to consider them during real estate transactions. Understanding appurtenances and their classification is crucial for real estate agents, buyers, and sellers to ensure smooth and successful transactions.

Learn More About Appurtenances

Appurtenances are just one of hundreds of terms which you’ll master as you study for your real estate license. The pre-license course from Chamberlin Real Estate School presents terms in a way that makes them easy to understand and remember. Any time you have questions, whether about terminology or fundamental concepts in real estate, you’ll have a live instructor available to help you as you prepare to become a Real Estate Agent. Start your journey today!