Real vs. Personal Property

Real vs. Personal Property

• Real property, or realty, includes land, anything affixed or attached to the land, and anything incidental or appurtenant to the land.
• Personal property is typically movable, unlike real property.
• Real property encompasses land, the subsurface, and the airspace above it, visualized as an inverted pyramid
• Improvements (anything added or built on the land) are considered real property.
• The "bundle of rights," including the rights to possess, use, enjoy, encumber, will, sell, or do nothing with the land, also constitutes real property.

Appurtenances

• Appurtenances are rights or benefits incidental to the land.
• Air rights allow a landowner to use the airspace above their land, provided it does not interfere with normal air traffic.
• Riparian rights grant a landowner the right to use the natural flow of a stream that flows through or is adjacent to their property.
• Appropriative rights allow a water user to obtain a permit from the state government to use water, regardless of owning land beside the water body.
• California water law combines appropriative rights with a limited form of riparian rights.
• Stock in a water company may be considered appurtenant to real property.
• Groundwater, or subsurface water, may be subject to appropriative rights or overlying rights (similar to riparian rights).
• A landowner owns all solid minerals beneath the surface of their property, but mineral rights can be sold separately.
• A landowner owns oil or gas pumped from wells on their land, even if it migrates from neighboring land, according to the rule of capture.
• Oil and gas are fugitive substances and are not considered property until brought to the surface.
• Lateral support is the support land receives from adjacent land.
• Subjacent support is the support land receives from the underlying earth.
• Easements and restrictions create appurtenant rights.

Attachments

• Natural attachments, such as those attached to the earth by roots, are part of the real property and transfer in a sale unless otherwise agreed.
• The doctrine of emblements allows a tenant farmer to harvest the first crop that matures, even if the tenancy ends through no fault of their own.
• Man-made attachments (fixtures) start as personal property but become real property when attached to the land.
• Personal property can be converted into real property through annexation, and an attachment may be converted into personal property through severance.

Distinguishing Fixtures

• There are five tests (MARIA) to determine whether an item is a fixture or personal property: Method of attachment, adaptation of item, relationship of parties, intention of annexor, and agreement in writing.
• A written agreement trumps all other tests in determining if an item is a fixture.
• Items permanently attached to the land are considered fixtures.
• Items designed or adapted for a specific property are considered fixtures.
• If the annexor intended the item to become part of the real property, it is considered a fixture.
• Items installed by owners are generally considered fixtures, while those installed by tenants are personal property, even trade fixtures.
• Mobile homes are personal property until permanently attached to the land, which affects their taxation and licensing rules.

Land Description Methods

• Clear and accurate, legal descriptions are essential in real property transfers.
• The three main methods of legal description are metes and bounds, government survey, and recorded map.
• The metes and bounds method describes property using monuments, courses (compass readings), and distances.
• A metes and bounds description starts at a point of beginning and describes each side of the property until returning to the starting point.
• In metes and bounds descriptions, monuments take precedence over courses and distances in case of discrepancies.
• The government survey method is used mostly in western states and describes property according to a grid of lines established by government surveyors.
• Each grid in the government survey method is identified by a principal meridian (north/south) and a base line (east/west).
• Township lines run east/west at six-mile intervals, dividing land into township tiers, and range lines run north/west, dividing land into ranges.
• A township is the 36-square-mile area at the intersection of a township tier and a range.
• Each township is divided into 36 sections of one square mile each, numbered 1-36 from the northeast corner, snaking back and forth to the southeast corner.
• Government lots are partial sections with irregular shapes due to the earth's curvature or bodies of water.
• In urban and suburban areas, the recorded map method describes property by mapping the boundaries of lots and blocks in a subdivision on a plat map.
• Referencing an adequate property description already in public record is another method of land description.
• A street address is NOT an adequate legal description.
• Land descriptions for air lots, such as condominium units above ground level, must describe the property's elevation according to a datum or bench mark.