What is the definition of real property?
The terms “real property” and “real estate” can be used interchangeably, but the definitions are slightly different. Real estate is defined as land, buildings and things permanently attached to the land and buildings. Real property includes the addition of anything permanently located within or under the land. Such as gases, oil, and minerals.
How does real differ from personal property?
Personal property is movable and real is immobile. Think of it this way. If you picked up a house, turned it upside down and shook it, the items that fell out would be considered personal property. All the items which didn’t fall out would be regarded as real.
Why is the distinction between the two types of property important?
If you are buying a property, all of the real property will convey. The personal property goes to the seller. Do you say you like that portable storage shed in the backyard? Well, since it is portable, it would be considered personal property, and the seller would take it with them when they move.
Can personal property become real?
Yup, it sure can. Say the owner of the portable storage shed mentioned above has a concrete foundation laid for it and then permanently installs it on the land. It would then be considered to be real property and would automatically convey to the buyer should the property be sold.
Real property can be changed to personal property by severance. Personal property can be changed to real property by attachment, such as in the example above.
As a buyer how would I make sure personal property would convey in a purchase?
Let’s say you want that portable storage shed. All you would need to do is list it in the purchase agreement. Then it would convey. If you don’t list it in the purchase agreement, then it will not convey.
How is real and personal property conveyed?
Okay, this is important for your real estate licensing exam. Ownership of real estate is transferred by deed from the seller (grantor) to the buyer (grantee). On the other hand, the transfer of ownership of personal property is done through a bill of sale.
What else can help me prepare to pass my real estate licensing exam on my first attempt?
Other tips to help you pass your real estate licensing exam on your first attempt:
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