Chapter One - Part #1

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The ITS School Of Real Estate Chapter One Video Series Chapter 1 … The Principles of Real Estate Law and Practice

What is a Brokerage? : 

What is a Brokerage? A Brokerage is in the business of bringing people together or facilitating a transaction . A Brokerage firm acts as a point of contact between two or more people. The I. T. S. School Of Real Estate Chapter One

What is an Appraisal?: 

What is an Appraisal? An Appraisal is the process of estimating a property’s value The ITS School Of Real Estate Chapter One

What does a property manager do? : 

What does a property manager do? A property manager is a person hired to maintain and manage property on behalf of the property owner. The ITS School Of Real Estate Chapter One

What is financing? And who are the parties involved? : 

What is financing? And who are the parties involved? Financing is the business of providing funds for the purchase or for the development of real estate. Usually the property to be purchased is leveraged as a security for the loan The Parties involved will be the lender and home buyer directly; indirectly a mortgage broker, a closing attorney, an appraiser, and possibly several realtors will be involved in the process indirectly. The ITS School Of Real Estate Chapter One

What are the 5 types of Real Estate Specializations? : 

What are the 5 types of Real Estate Specializations? 1. Residential 2. Commercial 3. Industrial 4. Agricultural 5. Special Purpose The ITS School Of Real Estate Chapter One

What is a seller’s market?: 

What is a seller’s market? This is when there is a shortage of product and the increased demand for limited resources creates an increase in prices The ITS School Of Real Estate Chapter One

What is a buyer’s market? : 

What is a buyer’s market? This is when the supply of goods exceeds the demand, and this creates a decrease in prices. The ITS School Of Real Estate Chapter One

What are the two factors that influence Supply? : 

What are the two factors that influence Supply? 1 . Labor force and Construction Cost 2 . Government controls and financial policies The ITS School Of Real Estate Chapter One

What are the 3 factors that influence Demand? : 

What are the 3 factors that influence Demand? 1. Population 2. Demographics 3. Employment / Unemployment The ITS School Of Real Estate Chapter One

What is Property? : 

What is Property? The word property refers to both the physical property owned, and more importantly, to the rights and interest involved in its use and ownership. The ITS School Of Real Estate Chapter One

Bundle of Rights: 

Bundle of Rights #1 Possession : Simply said, access to your own property #2 Control: The ability to determine the use and length of your use and ownership The ITS School Of Real Estate Chapter One

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#3 Enjoyment: The ability to use the property in any legal manner you see fit #4 Disposition: To be able to sell or otherwise convey the property #5 Exclusion: The right to keep others off your property The ITS School Of Real Estate Chapter One

The Concept of Real Property: : 

The Concept of Real Property : Land : The land is commonly thought of as the ground, but from a legal standpoint, Land ownership also includes possession and control of the minerals and substances below the earth’s surface and the air above. The ITS School Of Real Estate Chapter One

Real Estate : 

Real Estate A broader term that not only includes the land but anything that is attached to the land by natural or artificial attachment…. Homes, Barns, Parking lots, etc… The ITS School Of Real Estate Chapter One

Real Property : 

Real Property The term Real Property further expands the definition of real estate to include the bundle of legal right involved in ownership. The ITS School Of Real Estate Chapter One

Mineral Rights: 

Mineral Rights The ownership of substances below the surface, this includes metals, oil, and gas …. These rights can be sold separately. The ITS School Of Real Estate Chapter One

Air Rights: : 

Air Rights: As with surface rights, the right to the air above the property can be sold or purchased from others. Once considered unlimited, air rights are often limited to reasonable use The ITS School Of Real Estate Chapter One

Water Rights: : 

Water Rights: One right that may attach to ownership is the right to use a specific parcel of water. The ITS School Of Real Estate Chapter One

Riparian Rights: 

Riparian Rights This is when the flowing water such as a creek or stream that is non-navigable. Owner has right to use water as long as it does not interfere with downstream owners. Owner owns to the center of the waterway when the water is a border. The ITS School Of Real Estate Chapter One

Littoral rights: : 

Littoral rights: This the water rights to a large navigable source of water. The owner of a piece of property that borders such a body of water only owns the land down to the high water mark. The ITS School Of Real Estate Chapter One

Accretion and Erosion: 

Accretion and Erosion Accretion: Additional land gained by the deposits of soil ar rack by the movement of water. Erosion : Erosion is the gradual wearing away of land by the action of water or wind. The ITS School Of Real Estate Chapter One

Avulsion and Accession: 

Avulsion and Accession Avulsion: This is the sudden tearing away of land by the action of water or wind. Accession : This is the process of acquiring title to land gained through natural causes. The ITS School Of Real Estate Chapter One

Personal Property: 

Personal Property What makes personal property different from real property? Personal property is different from real property in that it is moveable. What is another name for personal property? Chattels The ITS School Of Real Estate Chapter One

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Under what circumstances is a trade fixture personal property ? An article or piece of business equipment attached to a rented space will be considered Personal Property regardless of the method or permanence of attachment. The ITS School Of Real Estate Chapter One

The MARIA Tests: Fixture or Not?: 

The MARIA Tests: Fixture or Not? Method : This considers the method of attachment and the permanence of the installation. Can the fixture be removed without significant damage to the property of value ? Agreement: Was there an agreement as to the right to remove the fixture ? The ITS School Of Real Estate Chapter One

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Relationship: Is the agreement between a tenant and landlord…. Or between a buyer and seller ? Intention: Are these fixtures trade fixtures? Are the fixtures essential to conducting business ? Adaption : Has the fixture been custom installed or fitted to meet the specific space? The ITS School Of Real Estate Chapter One

Characteristics of Real Estate: Physical…: 

Characteristics of Real Estate: Physical… Immobility: The geographic location of a parcel of land cannot be changed, it is fixed . Indestructibility : Land is durable and indestructible. The ITS School Of Real Estate Chapter One

Characteristics of Real Estate: Physical…: 

Characteristics of Real Estate: Physical… Non-homogeneity: No two parcels of land are ever the same . The ITS School Of Real Estate Chapter One

Characteristics of Real Estate: Economic…: 

Characteristics of Real Estate: Economic… Relative scarcity : Available land in a particular area can affect the value of as the desired quality is relatively scarce. Improvements: The improvements of one tract of land… This can be seen with a dump, a factory, or a golf course. The ITS School Of Real Estate Chapter One

Characteristics of Real Estate: Economic…: 

Characteristics of Real Estate: Economic… Permanence of Investment : The income return on land improvement investments are long term and relatively stable . Area Preference ( This is also known as SITUS ): Some areas just have an intangible or social value within the public’s view… this side of the tracks being or more value as that side of the tracks. The ITS School Of Real Estate Chapter One

Legal Descriptions, Measurements, and Identifications : 

Legal Descriptions, Measurements, and Identifications Define Legal description : A description that describes no other property but the one in question…This Allows another person to locate this one specific piece of property. The ITS School Of Real Estate Chapter One

Metes and Bounds: 

Metes and Bounds A description that makes use of the boundaries and measurements of the land in question, the description starts at a specifically designated point and proceeds around the boundary and returns to the original point . The ITS School Of Real Estate Chapter One

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The ITS School Of Real Estate Chapter One

PowerPoint Presentation: 

The ITS School Of Real Estate Chapter One

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What are monuments within a M&B description? Monuments are fixed positions or objects used to establish real estate boundaries. These can be both natural and manmade. What is the Benchmark on a M&B description ? A benchmark is a reference point that is used to correctly locate the “point of beginning”…This is the starting of the M & B description. This not on the property being described . The ITS School Of Real Estate Chapter One

Rectangular Survey System: 

Rectangular Survey System Sometimes called the government survey section, this system is based upon the intersection of meridian lines the run N and S, and base lines that run E and W. These lines run 6 miles apart and form individual townships that are 6 miles by 6 miles square. This 36 square miles. The ITS School Of Real Estate Chapter One

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The ITS School Of Real Estate Chapter One

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The ITS School Of Real Estate Chapter One

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How many square miles or sections are in a township? 36 How many square miles are in a section? 1 How many acres are in a section? 640 The ITS School Of Real Estate Chapter One

Lot and Block Number Method : 

Lot and Block Number Method This the subdivision of a larger tract of land commonly describe with a M & B description. A plat map breaks down this tract into roads and individual lots that have their own unique number. This is the common method for subdivisions Using a Plat map The ITS School Of Real Estate Chapter One

PowerPoint Presentation: 

The ITS School Of Real Estate Chapter One

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End of Section #1 The ITS School Of Real Estate Chapter One