Chapter 18 Ownership and Leasing of Real Property

Chapter 18 Ownership and Leasing of Real Property 18 -1 Ownership and Transfer of Real Property 18 -2 Leasing Real Property Law for Business and Personal Use © South-Western, a part of Cengage Learning Chapter 18 Slide 1

18 -1 Ownership and Transfer of Real Property GOALS n Understand both the rights and limitations associated with ownership of real property n Identify the forms of ownership and how they are transferred Law for Business and Personal Use © South-Western, a part of Cengage Learning Chapter 18 2

RIGHTS AND LIMITATIONS OF REAL PROPERTY OWNERSHIP n Real property rights n n Surface rights Rights to the air space above the land Mineral rights Water rights Continued on the next slide Law for Business and Personal Use © South-Western, a part of Cengage Learning Chapter 18 3

RIGHTS AND LIMITATIONS OF REAL PROPERTY OWNERSHIP n Limitations on ownership n n Easements Restrictive covenants Zoning ordinances Duties owed to entrants on land Law for Business and Personal Use © South-Western, a part of Cengage Learning Chapter 18 4

List four potential limitations on the ownership rights of real property. Law for Business and Personal Use © South-Western, a part of Cengage Learning Chapter 18 5

OWNERSHIP FORMS AND THEIR TRANSFER n Forms of real property ownership n n Fee simple absolute Conditional estate Life estate Non-freehold estate Continued on the next slide Law for Business and Personal Use © South-Western, a part of Cengage Learning Chapter 18 6

OWNERSHIP FORMS AND THEIR TRANSFER n Transfer of ownership n n Deed Gift, sale, or inheritance Adverse possession Dedication or eminent domain Law for Business and Personal Use © South-Western, a part of Cengage Learning Chapter 18 7

Name the four major types of estates in real property. Law for Business and Personal Use © South-Western, a part of Cengage Learning Chapter 18 8

18 -2 Leasing Real Property GOALS n Compare the various types of leases n Explain the rights and duties of landlords and tenants Law for Business and Personal Use © South-Western, a part of Cengage Learning Chapter 18 9

WHAT ARE THE TYPES OF LEASES? n n Periodic tenancy Tenancy for years Tenancy at sufferance Tenancy at will Law for Business and Personal Use © South-Western, a part of Cengage Learning Chapter 18 10

Name the four types of leaseholds. Law for Business and Personal Use © South-Western, a part of Cengage Learning Chapter 18 11

RIGHTS AND DUTIES OF THE TENANT n Tenant’s rights n Right of possession n Right to use the property n Right to assign the lease or to sublet the premises n Tenant’s duties n Duty to pay rent n Duty to take care of the property n Responsibility for torts Law for Business and Personal Use © South-Western, a part of Cengage Learning Chapter 18 12

RIGHTS AND DUTIES OF THE LANDLORD n Landlord’s rights n To receive agreed-upon rent n To sue to evict tenant n Landlord’s duties n Duty to provide habitable premises n Duty to conform to governmental requirements Law for Business and Personal Use © South-Western, a part of Cengage Learning Chapter 18 13

Name three rights a tenant has. Law for Business and Personal Use © South-Western, a part of Cengage Learning Chapter 18 14

PREVENT LEGAL DIFFICULTIES In dealing with real property. . . n If your personal property is to be attached to real property in any transaction, agree who will retain or receive ownership of it. Put the agreement in writing, whether the contract involved is a sale, lease, or mortgage. Continued on the next slide Law for Business and Personal Use © South-Western, a part of Cengage Learning Chapter 18 15

PREVENT LEGAL DIFFICULTIES n When purchasing real property, protect your interest by n having the property properly surveyed, particularly if it is irregularly shaped or has uncertain borders n requiring a deed containing all possible warranties n securing title insurance if it is available n being represented by a professional. If there is anything distinctive about the transaction, use a lawyer who specializes in real estate n Be sure that any deed to land you have purchased is recorded promptly. Continued on the next slide Law for Business and Personal Use © South-Western, a part of Cengage Learning Chapter 18 16

PREVENT LEGAL DIFFICULTIES n To prevent losing your land through adverse possession check it periodically to be sure no one is occupying it without your consent. n If you are asked to convey property and want to be free of possible future obligations, use a quitclaim instead of a warranty deed. Continued on the next slide Law for Business and Personal Use © South-Western, a part of Cengage Learning Chapter 18 17

PREVENT LEGAL DIFFICULTIES n If the government seeks to take your land by condemnation under its right of eminent domain, consult a lawyer. You have a right to a trial by jury to determine the fair price that must be paid. n Written residential leases generally are prepared by the landlord or the landlord’s attorney. Thus, such leases often contain many clauses that protect the landlord’s interests. Read with understanding before you sign. If the terms are unacceptable to you, request a change. If you are refused, go elsewhere. Continued on the next slide Law for Business and Personal Use © South-Western, a part of Cengage Learning Chapter 18 18

PREVENT LEGAL DIFFICULTIES n Do not remodel or significantly change premises of a leasehold without the consent of your landlord. n You may be held liable if someone is injured because of the faulty condition of premises you have rented if such condition was caused by your negligence. Normally you, as a tenant, have the duty to make necessary minor repairs and to notify your landlord of the need for major repairs. Protect yourself with careful maintenance and with adequate liability insurance. Continued on the next slide Law for Business and Personal Use © South-Western, a part of Cengage Learning Chapter 18 19

PREVENT LEGAL DIFFICULTIES n When you move, give your landlord proper notice. Such notice is required in periodic tenancies. Failure to give adequate notice may obligate you to pay additional rent even after you vacate the premises. Law for Business and Personal Use © South-Western, a part of Cengage Learning Chapter 18 20