Lesson 1: The Nature of Real Property Washington Real Estate Fundamentals

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Washington Real Estate Fundamentals
Lesson 1:
The Nature of Real Property
© 2011 Rockwell Publishing
Property
Real vs. personal
Two types of property:
 Real property: Land and anything
attached to it. Also called realty.
 Personal property: Anything that is not
real property; usually movable. Also
called personalty or chattels.
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Real Property
Bundle of rights
Real property ownership includes a bundle of
ownership rights, including the right to:
Possess
 Use
 Enjoy
 Encumber
 Will
 Sell
 Do nothing at all

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Real Property
Inverted pyramid
Imagine a
parcel of
land as an
inverted
pyramid.
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Summary
Basic Concepts
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Real property
Personal property
Bundle of rights
Inverted pyramid
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Appurtenances
Appurtenance: A right or interest that goes
along with ownership of real property, but isn’t
necessarily a physical part of the property.
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Appurtenances
Air rights
 Water rights
 Solid mineral rights
 Oil and gas rights
 Support rights

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Appurtenances
Air rights
Air rights: Landowner has the right to use the
airspace above the property.
Subject to restrictions, including:
 Federal aviation laws
 Local laws and private restrictions
Air rights can be sold separately from land (as
with condominiums).
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Appurtenances
Water rights
Two systems for allocating water rights:
 riparian rights system
 prior appropriation system
Either system can be applied both to surface
water and to subsurface water.
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Water Rights
Riparian rights system
Riparian rights: Right to use water that flows
through or adjacent to landowner’s property.
 Allowed to make reasonable use of water
without diminishing the flow.
 Allowed to use water for domestic
purposes on the riparian land.
 Not allowed to divert water for use on
non-riparian land.
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Water Rights
Riparian rights system
Two types of water in riparian rights system.
 Riparian water: Flowing water (river or
stream).
 Littoral water: Standing water (pond,
lake, or ocean).
Oceanfront (tidal) property and lakefront
property (navigable lake): property line is
the mean high water mark.
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Water Rights
Appropriative rights
Prior appropriation system: Developed to
address needs not met by riparian rights
system, particularly in arid areas.
 Appropriative rights have largely
replaced the riparian rights system in
some states (including Washington).
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Water Rights
Appropriative rights
Permit required for appropriative rights.
 Permit holder can take or divert water
from a particular source for a specified
reasonable and beneficial use.
 Example: irrigation
 Permit holder does not have to own land
beside the water source.
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Appurtenances
Solid mineral rights
Mineral rights: Landowner has right to extract
any solid minerals located within property’s
inverted pyramid.
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Appurtenances
Solid mineral rights
Minerals are:
 real property when in the ground
 personal property once extracted and
brought to the surface
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Appurtenances
Oil and gas rights
Rule of capture: Special rule for oil and gas.
Landowner owns all oil and gas produced
from (captured by) wells on her property.
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Appurtenances
Support rights
Support rights: Natural support provided to a
piece of land by the surrounding land.
 Subjacent support: Provided by
underlying earth.
 Lateral support: Provided by adjacent
land.
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Summary
Appurtenances
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Appurtenance
Air rights
Water rights
Riparian rights
Littoral rights
Appropriative rights
Mineral rights
Rule of capture
Support rights
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Attachments
Attachments: Things that are permanently
attached to land.
 May be natural or man-made.
 Are ordinarily considered part of the real
estate.
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Attachments
Natural attachments
Natural attachments: Trees, bushes, and
other plants; growing things that are attached
to the land by roots.
 Includes plants cultivated by people as
well as plants growing naturally.
 Transfer with the land unless otherwise
agreed.
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Natural Attachments
Doctrine of emblements
Doctrine of emblements: Special rule for
crops planted by tenant farmer.
 Applies when tenancy for indefinite
period terminates through no fault of
tenant.
 Tenant is allowed to return and harvest
crop after tenancy has ended.
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Natural Attachments
Severance
Once severed from the land, natural
attachments become personal property.
 For example, timber becomes personal
property when it’s cut down.
 Standing timber subject to a contract of
sale or crops sold before harvest are
considered constructively severed.
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Attachments
Fixtures
Fixtures: Man-made attachments to real
property.

Items that were once personal property.

Now attached to or connected with real
property in such a way that they have
become part of the real property.
 Example:
Lumber is personal property;
fence is real property.
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Attachments
Fixtures vs. personal property
Written agreement determines whether item is
treated as fixture or personal property.
If no written agreement, four legal tests
applied:
 method of attachment
 adaptation to the property
 intention of the annexor
 relationship of the parties
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Fixture Tests
Method of attachment test
Test 1:
 Is the item attached to the realty in some
way, and if so, how?
 Is the item movable?
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Fixture Tests
Adaptation test
Test 2:
 Has the item been specially adapted to
the realty in some way, or specially
designed for it?
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Fixture Tests
Intention test
Test 3:
 Did the person who installed (annexed)
the item intend it to become part of the
realty?
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Fixture Tests
Relationship test
Test 4:
 Did the person who installed the item
own the property, or was he just a
tenant?
 An item installed by a tenant is usually
considered personal property.
 An item installed by an owner is
usually considered real property.
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Fixture Tests
Trade fixtures
Trade fixtures: Equipment and other items
that commercial tenant installs to do
business.
 Generally remain tenant’s personal
property, no matter how they’re attached.
 Tenant may have to restore property to
original condition after removal of trade
fixtures.
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Attachments
Manufactured homes
New manufactured home is considered
personal property and has a title like a motor
vehicle.
Manufactured home may become real
property through a process called title
elimination.
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Attachments
Manufactured homes
After manufactured home’s title is eliminated:
 home is part of the real property on
which it is located
 transferred and taxed as real property
After title eliminated, a real estate licensee
may sell the home (otherwise, must have a
manufactured home dealer’s license).
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Summary
Attachments
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Attachment
Natural attachment
Doctrine of emblements
Fixture
Fixture tests
Trade fixture
Manufactured home
Title elimination
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Methods of Legal Description
When real property is transferred, land being
conveyed must be clearly identified.
 Precise description of a piece of land is
called the legal description.
Three main methods of legal description:
 metes and bounds
 government survey
 lot and block
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Methods of Legal Description
Metes and bounds
Metes and bounds description: Describes a
piece of land by specifying its boundaries.
 Monuments: Natural or man-made
objects that mark a fixed point.
 Courses: Compass directions.
 Distances: Length of each boundary.
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Metes and Bounds Descriptions
How they work
Starts with a point of
beginning, then gives
the course (direction)
and distance for each
leg of the boundary,
until it has described
the full circuit and
arrived back at the
point of beginning.
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Metes and Bounds Descriptions
Example
“Beginning at the old oak tree, go South 15° East 200
feet. Then go North 90° West 310 feet, more or less, to
the centerline of Smith Creek. Then go northwesterly
along the centerline of Smith Creek to a point due west
of the old oak tree. Then go North 90° East 430 feet,
more or less, to the point of beginning.”
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Methods of Legal Description
Government survey
Government survey description: Property
identified by location in a section, township,
and range on a U.S. government survey map.
 Also called rectangular survey
description.
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Government Survey Descriptions
Grid system
Government survey system is made up
of a series of very large survey grids covering
much of the U.S., including Washington.
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Government Survey Descriptions
Principal meridian & base line
Each grid has its own:
 principal meridian (main north-south line)
 base line (main east-west line)
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Government Survey Descriptions
Principal meridian & base line
Each grid identified by
name of principal meridian.
In Washington:
 Willamette Meridian
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Government Survey Descriptions
Range & township lines
Each grid has grid lines running parallel to
principal meridian and parallel to base line at
intervals of six miles.
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Government Survey Descriptions
Range & township lines
North-south lines, called range lines, divide
the land into columns called ranges.
 Each range is six miles wide.
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Government Survey Descriptions
Range & township lines
East-west lines, called township lines, divide
the land into rows called township tiers.
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Government Survey Descriptions
Townships
Each individual square is called a township.
 Particular township identified by its position
in relation to base line and principal
meridian.
Township =
6 miles
×
6 miles
36 square miles
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Government Survey Descriptions
Townships
This township: “Township 4 North, Range 5 East.”
It’s the township created by the intersection of the
fourth township tier north of the base line and the
fifth range east of the principal meridian.
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Government Survey Descriptions
Complete description
Complete government survey description must
include section, township, and range.
 Name of principal meridian must also be
included, to identify grid.
Example:
N ½ of NE ¼ of SE ¼, T4N R3D, Willamette
Meridian, Clark County, State of Washington
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Government Survey Descriptions
Sections
Each township is divided
into 36 sections.
 Each section is one
mile on each side, or
one square mile.
 Each section is 640
acres.
 1 acre = 43,560
square feet.
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Government Survey Descriptions
Partial sections
Most individual
parcels are only part
of a section, so they
are described in
terms of fractions of
sections.
 For example, the
N ½ of the NE ¼
of the SE ¼.
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NW1/4
160 ACRES
NE1/4
160 ACRES
SW1/4
160 ACRES
N 1/2 OF NE1/4
OF SE1/4
40 ACRES
Methods of Legal Description
Lot and block
Lot and block description: Standard method
for describing property in towns and cities.
 Property identified by its lot number on a
subdivision plat.
Plat: Survey map developer must record
when land is subdivided. Also called a plat
map.
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Lot and Block Descriptions
Plat map
Plat map shows precise location and
dimensions of each lot.
 Each lot is assigned a lot number.
 Groups of lots separated by streets within
the subdivision may also be assigned block
numbers.
 For each lot, plat will include lot’s
dimensions, boundary lines (established by
survey), and utility easements.
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Lot and Block Descriptions
Example
Once plat map recorded, a parcel can be
described by giving:
 lot and block numbers
 name of subdivision
 city and/or county
“Lot 7, Block 2, in the Lowland Heights
subdivision, according to the plat thereof
recorded at Vol. 22, Page 16, in the records
of Spokane County, State of Washington.”
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Methods of Legal Description
Other methods
Other methods of describing land:
 Reference to description in earlier recorded
document.
 Reference to recorded survey map or tax
assessor’s map.
 Generalized description, such as “all my
land in King County.”
Street address generally not considered
adequate description for legal documents.
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Summary
Methods of Legal Description
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Legal description
Metes and bounds method
Monuments, courses, distances
Government survey method
Section, township, and range
Principal meridian and base line
Lot and block method
Plat map
© 2011 Rockwell Publishing
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