Podcast
Questions and Answers
What is the primary source of funding for local operations including schools in many communities?
What is the primary source of funding for local operations including schools in many communities?
What happens if property taxes are not paid?
What happens if property taxes are not paid?
What type of restriction applies to many parcels of land?
What type of restriction applies to many parcels of land?
What is usually recorded in a written legal document for a deed restriction?
What is usually recorded in a written legal document for a deed restriction?
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What is the primary focus of the module on legal considerations in appraisal?
What is the primary focus of the module on legal considerations in appraisal?
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What is an example of a private restriction on property ownership?
What is an example of a private restriction on property ownership?
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What usually prevails when deed restrictions conflict with zoning restrictions?
What usually prevails when deed restrictions conflict with zoning restrictions?
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What is the term for physical things that have not or have never had an owner?
What is the term for physical things that have not or have never had an owner?
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What is an example of a subdivision deed restriction?
What is an example of a subdivision deed restriction?
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What is the term for things owned by an individual or a group of people?
What is the term for things owned by an individual or a group of people?
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What is the term for the property status of a thing while it remains in a wild, unappropriated state?
What is the term for the property status of a thing while it remains in a wild, unappropriated state?
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What is the purpose of a subdivision deed restriction that states the minimum cost of a house to be constructed on a parcel of land?
What is the purpose of a subdivision deed restriction that states the minimum cost of a house to be constructed on a parcel of land?
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What is the definition of real estate?
What is the definition of real estate?
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What is a fundamental category of legal interests in real estate?
What is a fundamental category of legal interests in real estate?
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What is the term for things owned by the state?
What is the term for things owned by the state?
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What is the primary focus of the six legal considerations in appraisal?
What is the primary focus of the six legal considerations in appraisal?
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What is the obligation of a tenant in a leasehold estate?
What is the obligation of a tenant in a leasehold estate?
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What is the significance of air rights in urban areas?
What is the significance of air rights in urban areas?
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What happens when the contract rent is more than the economic or market rent?
What happens when the contract rent is more than the economic or market rent?
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What can an owner of a parcel of land retain?
What can an owner of a parcel of land retain?
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What is the focus of appraisers in relation to real property?
What is the focus of appraisers in relation to real property?
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What is the most common form of ownership?
What is the most common form of ownership?
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What can be acquired by a government agency through eminent domain?
What can be acquired by a government agency through eminent domain?
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What is related to real property?
What is related to real property?
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What is the primary purpose of a time-share ownership?
What is the primary purpose of a time-share ownership?
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What is unique about land as a commodity?
What is unique about land as a commodity?
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What type of ownership allows tenant-stockholders to select their neighbors?
What type of ownership allows tenant-stockholders to select their neighbors?
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What is the purpose of a metes-and-bounds description?
What is the purpose of a metes-and-bounds description?
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What does a tenancy typically refer to in real estate?
What does a tenancy typically refer to in real estate?
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How many weeks are typically sold in a time-share ownership?
How many weeks are typically sold in a time-share ownership?
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What is an undivided interest in real property?
What is an undivided interest in real property?
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What is a characteristic of a metes-and-bounds description?
What is a characteristic of a metes-and-bounds description?
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What is a special type of ownership where an owner has an interest in a unit and a share of common areas?
What is a special type of ownership where an owner has an interest in a unit and a share of common areas?
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What type of ownership is restricted to a certain period or week of the year?
What type of ownership is restricted to a certain period or week of the year?
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What is a cooperative in the context of property ownership?
What is a cooperative in the context of property ownership?
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What is a time-share in the context of property ownership?
What is a time-share in the context of property ownership?
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What is the purpose of using legal descriptions in real estate?
What is the purpose of using legal descriptions in real estate?
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What is the main difference between a condominium and a cooperative?
What is the main difference between a condominium and a cooperative?
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What is unique about the concept of an undivided interest in real property?
What is unique about the concept of an undivided interest in real property?
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What is a key characteristic of special forms of ownership such as condominium, cooperative, and time-share?
What is a key characteristic of special forms of ownership such as condominium, cooperative, and time-share?
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Possession must involve all of the following: be apparent, be continuous and uninterrupted for a certain period of time, and be exclusive.
Possession must involve all of the following: be apparent, be continuous and uninterrupted for a certain period of time, and be exclusive.
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If property taxes are not paid, governments have no right to acquire the properties.
If property taxes are not paid, governments have no right to acquire the properties.
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Private restrictions on real estate ownership can be transferred with the property when it sells.
Private restrictions on real estate ownership can be transferred with the property when it sells.
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Fee simple estate is the most complete form of ownership that has no limitations.
Fee simple estate is the most complete form of ownership that has no limitations.
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A leased fee estate is the landlord’s interest in a property when there is a lease encumbering the property.
A leased fee estate is the landlord’s interest in a property when there is a lease encumbering the property.
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Deed restrictions are usually applied to many parcels of land.
Deed restrictions are usually applied to many parcels of land.
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When deed restrictions conflict with zoning restrictions, the zoning restriction usually prevails.
When deed restrictions conflict with zoning restrictions, the zoning restriction usually prevails.
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A leasehold estate is the landlord’s interest in a property when there is a lease encumbering the property.
A leasehold estate is the landlord’s interest in a property when there is a lease encumbering the property.
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A deed restriction is a written legal document that is usually not recorded.
A deed restriction is a written legal document that is usually not recorded.
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An appraisal of any interest less than fee simple begins with an analysis of the fee simple value.
An appraisal of any interest less than fee simple begins with an analysis of the fee simple value.
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A partial interest is a type of ownership that is more complete than a fee simple estate.
A partial interest is a type of ownership that is more complete than a fee simple estate.
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Mortgages are an example of governmental restrictions on real estate ownership.
Mortgages are an example of governmental restrictions on real estate ownership.
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The landlord usually retains the right to receive rent in exchange for giving up use of the property for a specified period of time.
The landlord usually retains the right to receive rent in exchange for giving up use of the property for a specified period of time.
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Deed restrictions can have no time limitations.
Deed restrictions can have no time limitations.
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A subdivision deed restriction may state that the minimum cost of the house to be constructed on a parcel of land is P10,000,000.
A subdivision deed restriction may state that the minimum cost of the house to be constructed on a parcel of land is P10,000,000.
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A leasehold estate is typically associated with the landlord’s interest in a property.
A leasehold estate is typically associated with the landlord’s interest in a property.
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All liens are mortgages.
All liens are mortgages.
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A mortgage is a type of loan that is not secured by real estate.
A mortgage is a type of loan that is not secured by real estate.
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An encroachment is a type of lien that is placed on a property.
An encroachment is a type of lien that is placed on a property.
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Adverse possession is a method of acquiring ownership through purchase.
Adverse possession is a method of acquiring ownership through purchase.
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A lien is a type of trespass on another's land.
A lien is a type of trespass on another's land.
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Foreclosure is a process of acquiring ownership through adverse possession.
Foreclosure is a process of acquiring ownership through adverse possession.
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A mortgage instrument is usually created when a property is purchased with cash.
A mortgage instrument is usually created when a property is purchased with cash.
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A person can acquire title to a property through adverse possession if they utilize another person's property openly for a short period of time.
A person can acquire title to a property through adverse possession if they utilize another person's property openly for a short period of time.
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A condominium describes a type of building, not a type of ownership.
A condominium describes a type of building, not a type of ownership.
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In a cooperative, the residents own the land and improvements.
In a cooperative, the residents own the land and improvements.
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Tenancy refers to the possession of title or other ownership form in real estate.
Tenancy refers to the possession of title or other ownership form in real estate.
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Undivided interest in real property means that the property itself cannot be divided.
Undivided interest in real property means that the property itself cannot be divided.
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A time-share is a type of ownership where an owner has an interest in a unit and a share of common areas.
A time-share is a type of ownership where an owner has an interest in a unit and a share of common areas.
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Cooperatives are most common in urban areas.
Cooperatives are most common in urban areas.
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In a condominium, an owner only owns the unit they occupy.
In a condominium, an owner only owns the unit they occupy.
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A tenancy refers to a leased property in which the lessee has the right to use and occupy the property.
A tenancy refers to a leased property in which the lessee has the right to use and occupy the property.
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Time-share owners have a restricted ownership and occupancy of a unit in the building.
Time-share owners have a restricted ownership and occupancy of a unit in the building.
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A metes-and-bounds description begins at a point of reference and uses angles and distances to define the parcel's perimeter.
A metes-and-bounds description begins at a point of reference and uses angles and distances to define the parcel's perimeter.
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A cooperative is a type of ownership where tenant-stockholders have no control over selecting their neighbors.
A cooperative is a type of ownership where tenant-stockholders have no control over selecting their neighbors.
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Land is a unique commodity because it is mobile.
Land is a unique commodity because it is mobile.
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A metes-and-bounds description only defines the geometric shape of the parcel.
A metes-and-bounds description only defines the geometric shape of the parcel.
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In a time-share, 50 weeks per year are reserved for maintenance.
In a time-share, 50 weeks per year are reserved for maintenance.
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A time-share owner has a 2 percent ownership in the unit if they buy one week.
A time-share owner has a 2 percent ownership in the unit if they buy one week.
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The primary purpose of a metes-and-bounds description is to describe the property's unique characteristics.
The primary purpose of a metes-and-bounds description is to describe the property's unique characteristics.
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The ownership of real estate is a direct function of constitutional ______ guarantees.
The ownership of real estate is a direct function of constitutional ______ guarantees.
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Res nullius are those physical things which 'have not or have never had' an ______.
Res nullius are those physical things which 'have not or have never had' an ______.
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Res Alicujus refers to things owned by ______ or a group of people.
Res Alicujus refers to things owned by ______ or a group of people.
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Res Communes refers to the property status of a thing while it remains in a wild, ______ state.
Res Communes refers to the property status of a thing while it remains in a wild, ______ state.
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Real estate relates to the ______ and all improvements permanently attached to the land.
Real estate relates to the ______ and all improvements permanently attached to the land.
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The primary focus of the module on legal considerations in appraisal is on the various ______ involved in the ownership of real property.
The primary focus of the module on legal considerations in appraisal is on the various ______ involved in the ownership of real property.
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The six legal considerations in appraisal focus on ______ such as fundamental definitions of legal interests, limitations on ownership, and more.
The six legal considerations in appraisal focus on ______ such as fundamental definitions of legal interests, limitations on ownership, and more.
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A professional appraiser must understand the various ______ considerations involved in the ownership of real property.
A professional appraiser must understand the various ______ considerations involved in the ownership of real property.
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When a dishwasher has been delivered to a construction site and is awaiting installation, it is ______ property.
When a dishwasher has been delivered to a construction site and is awaiting installation, it is ______ property.
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Light fixtures, stoves, and basketball goals are examples of ______.
Light fixtures, stoves, and basketball goals are examples of ______.
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The purest and most complete form of real estate ownership is ______ simple.
The purest and most complete form of real estate ownership is ______ simple.
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Private restrictions on real estate ownership may require a minimum ______ area.
Private restrictions on real estate ownership may require a minimum ______ area.
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The four powers of government that limit the ownership of all real property are police power, eminent domain, ______, and taxation.
The four powers of government that limit the ownership of all real property are police power, eminent domain, ______, and taxation.
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Zoning is intended to promote orderly development of ______.
Zoning is intended to promote orderly development of ______.
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Police power is the right of government to regulate ______ use for the public good.
Police power is the right of government to regulate ______ use for the public good.
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By promoting orderly development, zoning generally tends to maximize and maintain an individual parcel’s ______.
By promoting orderly development, zoning generally tends to maximize and maintain an individual parcel’s ______.
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In many communities, property taxes are the primary ______ basis for local operations including schools.
In many communities, property taxes are the primary ______ basis for local operations including schools.
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If property taxes are not paid, governments have the right to acquire the ______, although proper legal procedures.
If property taxes are not paid, governments have the right to acquire the ______, although proper legal procedures.
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A deed restriction is a limitation on the use of real estate through a written legal ______ that is usually recorded.
A deed restriction is a limitation on the use of real estate through a written legal ______ that is usually recorded.
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Usually deed restrictions have ______ limitations, but under certain circumstances, they can be extended.
Usually deed restrictions have ______ limitations, but under certain circumstances, they can be extended.
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One of the most common deed restrictions is a subdivision ______ covenant.
One of the most common deed restrictions is a subdivision ______ covenant.
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A subdivision deed restriction may state that the minimum size of a house must be ______ square meters.
A subdivision deed restriction may state that the minimum size of a house must be ______ square meters.
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Another common restriction, particularly in first-class residential subdivisions, would be state that the minimum ______ of the house to be constructed on a parcel of land is P5,000,000.
Another common restriction, particularly in first-class residential subdivisions, would be state that the minimum ______ of the house to be constructed on a parcel of land is P5,000,000.
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Private restrictions on real estate ownership may or may not ______ with the property when it sells.
Private restrictions on real estate ownership may or may not ______ with the property when it sells.
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An easement conveys the right to use part of the land for a specific _______________.
An easement conveys the right to use part of the land for a specific _______________.
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Utility companies have to acquire easements to extend utility _______________ through property.
Utility companies have to acquire easements to extend utility _______________ through property.
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A lease is a contractual agreement between a property owner (lessor) and a tenant (_______________).
A lease is a contractual agreement between a property owner (lessor) and a tenant (_______________).
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The owner usually receives the right to collect _______________ from the tenant and also has the right of reversion.
The owner usually receives the right to collect _______________ from the tenant and also has the right of reversion.
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Easements thus divide the bundle of _______________.
Easements thus divide the bundle of _______________.
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An easement that runs with the land and can be conveyed from a seller to a buyer is called an easement _______________.
An easement that runs with the land and can be conveyed from a seller to a buyer is called an easement _______________.
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An easement that serves only one person that cannot be conveyed from a seller to a buyer is called an easement in _______________.
An easement that serves only one person that cannot be conveyed from a seller to a buyer is called an easement in _______________.
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The tenant acquires the right to occupy and use a property and the owner usually receives the right to collect _______________ from the tenant.
The tenant acquires the right to occupy and use a property and the owner usually receives the right to collect _______________ from the tenant.
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The tenant usually obtains the right to use and occupy the ______ property.
The tenant usually obtains the right to use and occupy the ______ property.
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Air rights are particularly important in ______ areas.
Air rights are particularly important in ______ areas.
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A government agency may acquire ______ rights for the construction of an underground sewerage system.
A government agency may acquire ______ rights for the construction of an underground sewerage system.
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An owner of a parcel of land may retain the ______ rights for use as parking and sell the air rights for an overhead walkway.
An owner of a parcel of land may retain the ______ rights for use as parking and sell the air rights for an overhead walkway.
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The bundle of rights relates to ______ property and can be divided.
The bundle of rights relates to ______ property and can be divided.
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This is the most common form of ownership where one person or corporation owns the entire bundle of ______.
This is the most common form of ownership where one person or corporation owns the entire bundle of ______.
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A leasehold estate can have a positive value if the contract rent is less than the ______ rent.
A leasehold estate can have a positive value if the contract rent is less than the ______ rent.
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As appraisers, we are concerned with the valuation of an ownership interest in specified ______ estate.
As appraisers, we are concerned with the valuation of an ownership interest in specified ______ estate.
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Match the following forms of legal descriptions for real estate:
Match the following forms of legal descriptions for real estate:
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Match the following types of ownership:
Match the following types of ownership:
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Match the following characteristics of a metes-and-bounds description:
Match the following characteristics of a metes-and-bounds description:
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Match the following forms of ownership with their characteristics:
Match the following forms of ownership with their characteristics:
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Match the following terms with their definitions:
Match the following terms with their definitions:
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Match the following types of ownership with their purposes:
Match the following types of ownership with their purposes:
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Match the following descriptions with their purposes:
Match the following descriptions with their purposes:
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Match the following types of interest in real estate with their definitions:
Match the following types of interest in real estate with their definitions:
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Match the following terms with their definitions:
Match the following terms with their definitions:
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Match the following special forms of ownership with their characteristics:
Match the following special forms of ownership with their characteristics:
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Study Notes
Legal Considerations in Appraisal
- Ownership of real estate is a direct function of constitutional guarantees.
- Six legal considerations involved in the ownership of real property that a professional appraiser must understand:
- Fundamental definitions of legal interests
- Limitations on ownership of real estate
- Forms of legal interests
- Property ownership forms
- Four types of legal descriptions
- Types of real estate transfers
Fundamental Definitions of Legal Interests
- Property: all things which are, or may be the object of appropriation.
- Res nullius: physical things that have not or have never had an owner, cannot be owned, and are not, or more accurately cannot be, appropriated.
- Res: things owned by an individual, a group of people, or the state.
- Res Alicujus: things owned by someone, belonging to a particular person.
- Res Alienae: things owned by others, or a group of people.
- Res Communes: property status of a thing while it remains in a wild, unappropriated state, can be owned and are owned by the state.
Real Estate
- Relates to the land and all improvements permanently attached to the land, either by nature or by people.
- Property taxes are the primary funding basis for local operations, including schools.
- If property taxes are not paid, governments have the right to acquire the properties, although proper legal procedures must be followed.
Limitations on Ownership of Real Estate
- Private restrictions on property ownership:
- Deed restrictions
- Easements
- Leases
- Mortgages
- Liens
- Deed restrictions: limitations on the use of real estate through a written legal document that is usually recorded.
- Deed restrictions usually relate to a specific parcel or even a defined subdivision or planned use development.
- When deed restrictions are in conflict with zoning, usually the more restrictive prevails.
Forms of Legal Interests
- Partial interests:
- Air rights
- Surface/subsurface rights
- Air rights: particularly important in urban areas, do not extend indefinitely, and have height limitations imposed by public or private restrictions.
- Surface/subsurface rights: also come into play more in urban areas, where a government agency may acquire subsurface rights for construction of an underground sewerage system.
Property Ownership Forms
- Individual (severalty): the most common form of ownership where one person or corporation owns the entire bundle of rights, still subject to governmental and private restrictions.
- Tenancies: created when the bundle of rights is divided, relating to the possession of title or other ownership form and the right to use and occupy property.
- Undivided interests: relate to the ownership of real property, where the property itself cannot be divided, only the ownership interest.
- Special forms of ownership:
- Condominium
- Cooperative
- Time-share
Special Forms of Ownership
- Condominium: a form of ownership in which an owner has an interest in a certain unit, and also owns a pro-rata share of the common areas within the development.
- Cooperative: a form of ownership in which a corporation owns the land and improvements, and the residents own stock in the corporation.
- Time-share: a partial form of ownership in which other time-share owners purchase the right of use/occupancy for a specified period of time.
Forms of Legal Descriptions
- Four types of legal descriptions:
- Metes-and-bounds description
- Government (rectangular) survey system
- Lot-and-block system
- Monuments system
- Metes-and-bounds description: begins at a point of beginning, using angles and distances to define the geometric shape, and makes reference to a specific land lot, within a district/barangay, within a city/municipality.
Possession of Real Property
- Possession must be apparent, continuous, and uninterrupted for a certain period of time.
- Possession must be exclusive and claimed by the person having the apparent possession.
Forms of Legal Interest
- Fee Simple Estate: The most complete form of ownership, limited by the four powers of government.
- Partial Interests: Any interest less than a fee simple interest, including leased fee estate and leasehold estate.
Partial Interests
- Leased Fee Estate: A landlord's interest in a property when there is a lease encumbering the property.
- Leasehold Estate: A tenant's interest in a leased property.
Limitations on Ownership of Real Estate
- Governmental Restrictions: Includes zoning restrictions, eminent domain, and escheat.
- Private Restrictions: Includes deed restrictions, easements, leases, mortgages, and liens.
Private Restrictions on Real Estate Ownership
- Deed Restrictions: Limitations on the use of real estate through a written legal document, usually recorded.
- Mortgages: A loan or promissory note secured by the real estate, which can lead to foreclosure if not paid back.
- Liens: A charge against a property in which the property is security for payment of a debt.
- Encroachments: A trespass on another's land, which can be corrected by force.
- Adverse Possession: A method of acquiring ownership through possession, requiring several requirements.
Property Ownership Forms
- Tenancies: The possession of title or other ownership form, and the right to use and occupy property.
- Undivided Interests: An interest in the real property, where the property itself cannot be divided, only the ownership interest.
Special Forms of Ownership
- Condominium: A type of ownership where an owner has an interest in a certain unit and a pro-rata share of the common areas.
- Cooperative: A form of ownership where a corporation owns the land and improvements, and residents own stock in the corporation.
- Time-Share: A partial form of ownership where multiple owners purchase the right of use/occupancy for a specified period of time.
Forms of Legal Descriptions
- Legal descriptions are methods of describing real estate to recognize its unique characteristics with regard to location.
- There are four types of legal land descriptions: metes-and-bounds description, government (rectangular) survey system, lot-and-block system, and monuments system.
Metes-and-Bounds Description
- A metes-and-bounds description begins at a point of beginning (POB) and uses angles and distances to define the geometric shape of the parcel.
- It also makes reference to a specific land lot, within a district/barangay, within a city/municipality.
Real Estate and Fixtures
- A dishwasher is considered personal property until it is installed, at which point it becomes a fixture and part of the real estate.
- Examples of fixtures include light fixtures, stoves, and permanently installed basketball goals.
Limitations on Ownership of Real Estate
- Even with fee simple ownership, there can be private restrictions placed on the property by previous owners or developers.
- These restrictions may include minimum floor areas, architectural controls, and placement of improvements.
- Governmental controls, such as zoning and building codes, can also limit the use of real estate.
Public (Government) Restrictions on Real Estate Ownership
- There are four public or governmental restrictions on real estate ownership, known as the four powers of government:
- Police power: the right of government to regulate land use for the public good, including zoning and building codes.
- Eminent domain: the right of government to acquire private property for public use.
- Escheat: the right of government to take possession of property if the owner dies without an heir.
- Taxation: the right of government to impose taxes on real estate.
Fundamental Definitions of Legal Interests
- Property: all things that can be owned, including physical objects and intangible rights.
- Res nullius: things that have never been owned or can never be owned.
- Res aliquojus: things owned by individuals.
- Res communes: things that are common to all, such as public parks.
Real Estate
- Real estate refers to land and all improvements permanently attached to the land, including buildings and other structures.
Limitations on Ownership of Real Estate
- Private restrictions on real estate ownership can include:
- Deed restrictions: limitations on the use of real estate through written legal documents.
- Easements: the right to use part of the land for a specific purpose, such as utility lines or highways.
- Leases: contractual agreements between property owners and tenants.
- Mortgages and liens: financial obligations that can limit the use of real estate.
Easements
- Easements can be temporary or perpetual, and can be conveyed from seller to buyer.
- An easement appurtenant is an easement that runs with the land and can be conveyed from seller to buyer.
- An easement in gross is an easement that serves only one person and cannot be conveyed from seller to buyer.
Leases
- A lease is a contractual agreement between a property owner and a tenant, specifying the use of a property for an identified period of time.
- The tenant acquires the right to occupy and use the property, while the owner receives the right to collect rent and has the right of reversion.
Forms of Legal Interests
Partial Interests
- Air rights are particularly important in urban areas, where buildings are constructed within an identified air space.
- Surface/subsurface rights can be sold or acquired, such as for underground sewerage systems or overhead walkways.
Property Ownership Forms
- Individual (severalty) ownership is the most common form of ownership, where one person or corporation owns the entire bundle of rights.
- Other forms of ownership include joint tenancy, tenancy in common, and community property.
Real Estate Ownership
- A dishwasher is personal property when delivered to a construction site, but becomes a fixture and part of the real estate when installed.
- Examples of fixtures include light fixtures, stoves, and permanently installed basketball goals.
Limitations on Ownership of Real Estate
- Fee simple is the purest and most complete form of real estate ownership, but it is not exclusive.
- Private restrictions may be placed on the property by the previous owner or developer, such as minimum floor area, architectural controls, and placement of improvements.
- Governmental controls also limit the ownership of real estate.
- When purchasing real estate, one should recognize that the purchase is made subject to these restrictions.
Public (Government) Restrictions on Real Estate Ownership
- The four powers of government that limit the ownership of real property are:
- Police power
- Eminent domain
- Escheat
- Taxation
- Police power is the right of government to regulate land use for the public good, and includes zoning and building codes.
- Zoning is intended to promote orderly development of land and generally tends to maximize and maintain an individual parcel's value.
Fundamental Definitions of Legal Interests
- Property refers to all things that can be owned or may be the object of appropriation.
- Res nullius refers to things that have not or have never had an owner, and cannot be owned.
- Res aliquus refers to things owned by individuals or a group of people.
- Res communes refers to things that are common to all and can be owned by the state.
Real Estate
- Real estate relates to the land and all improvements permanently attached to the land, either by nature or by people.
Private Restrictions on Real Estate Ownership
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Easements convey the right to use part of the land for a specific purpose, and divide the bundle of rights.
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Examples of easements include utility companies acquiring easements to extend utility lines through property, and governmental authorities acquiring temporary easements to widen a highway.
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Easements can be classified into two types:
- Easement appurtenant, which runs with the land and can be conveyed from a seller to a buyer.
- Easement in gross, which serves only one person and cannot be conveyed from a seller to a buyer.
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Leases are contractual agreements between a property owner (lessor) and a tenant (lessee), specifying the use of a property for an identified period of time.
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The owner usually receives the right to collect rent from the tenant and has the right of reversion, which is the right to get the property back at the end of the lease.
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Mortgages are loan or promissory notes secured by the real estate, and if the loan is not paid back according to the agreed upon terms and conditions, the lending institution can acquire title to the property through foreclosure.
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Liens are charges against a property in which the property is security for payment of a debt, and can take many forms, including condominium association fees and mechanic's liens.
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Encroachments are trespasses on another's land, and can be forced to correct the encroachment.
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Adverse possession is a method of acquiring ownership through possession, and requires several requirements, including open and continuous use of the property for an extended period of time.
Property Ownership Forms
- Special forms of ownership include time-shares, in which other time-share owners purchase the right of use/occupancy for a specified period of time.
Forms of Legal Descriptions
- Legal descriptions are methods of describing real estate to recognize its unique characteristics with regard to location, and include:
- Metes-and-bounds description
- Government (rectangular) survey system
- Lot-and-block system
- Monuments system
Metes-and-Bounds Description
- A metes-and-bounds description begins at a point of beginning (POB) and uses distance and direction to describe the perimeter of the parcel, eventually returning to the POB.
- A basic understanding of plane geometry is needed in this system because of the emphasis on angles and distances.
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Description
This quiz covers the legal considerations involved in real estate appraisal, including fundamental definitions, limitations on ownership, and forms of property ownership. It's a crucial module for real estate brokers and appraisers to understand.
