Real property is land. It is a type of property differentiated from personal property. This article discusses the ownership of land using the interpretation of real property as a legal term used in Anglo-American common law jurisdictions as opposed to immovable property in civil law jurisdictions. (In Scotland it is heritable property; in French it is described as immobilier.) Other legal geopolitical systems of government have differing and different legal interpretations concerning the ownership of land. Generally speaking most real property consists, at least partially, of real estate.
History of the word
The word 'real' in the context of 'real estate' is not the opposite of 'unreal' but is in fact derived from the same source as the word 'royal'. An illustration of this is found today in the name of soccer team Real Madrid, meaning Royal Madrid.
When the word 'real' was originally used in conjunction with the word 'property', it had the literal meaning under common law of royal property . Translated for application in the United Kingdom today, this term refers to Crown property (since the real property rights of the British Royal Family were amended under the Act of Settlement.) However, since Scotland is not a common law jurisdiction, its strict interpretation today differs from that of its application to England and Wales and other localities where common law does apply.
Within international jurisdictions, such as those states of the United States where common law is applicable (and not all states are common law states), the term refers to both the land owned by the federal government; land owned by the state; land owned by Indian tribes (where applicable), and the land owned by individuals and companies within that state. This is in contrast to all other property in such states which is then deemed to be 'personal' property.
Even when common law is the governing law, intepretations of real property under common law vary according to the jurisdiction.
WARNING : The following text was originally obtained from the 1911 edition of Encyclopædia Britannica. While it has been modified by various editors, it may not be entirely accurate according to a strict interpretation of applicable law today. (In 1911 the encyclopedia was a British publication and heavily weighted to a British interpretation of information in that day.)
Land relationship to owner
Real property is not just the ownership of property and buildings, it includes many legal relationships between owners of real estate that are purely conceptual such as the easement, where a neighboring property may have some right on your property, right-of-way, or the right to pass over a property, and incorporeal heridiments such as profit a prendre. Real property can also be held in various ways. In some jurisdictions it is held absolutely, in England it may still be considered to be carved out of Crown's ownership of all property in the realm. Such distinctions are important in terms of the law of escheat or when property reverts to the state because it lacks an owner or has been abandoned.
An important area of real property are the definitions of estates in land. These are various interests that may limit the ownership rights one has over the land. The most common and perhaps most absolute type of estate is the fee simple which signifies that the owner has the right to dispose of the property as she/he sees fit. Other estates include the life estate where the owner's rights to the property cease at their death and fee tail estates where the property at the time of death passes to the heirs of the body (i.e. children, grandchildren, descendants) of the owner of the estate before he died.
Estates may also be held jointly as joint tenants with rights of survivorship or as tenants in common. The difference in these two types of joint ownership of an estate in land is basically the inheritability of the estate. In joint tenancy (or in marriage this is sometimes called tenancy of the entirety) the surviving tenant (or tenants) become the sole owner (or owners) of the estate. Nothing passes to the heirs of the deceased tenant. In some jurisdictions the magic words "with right of survivorship" must be used or the tenancy will assumed to be tenants in common. Tenants in common will have a heritable portion of the estate in proportion to their ownership interest which is presumed to be equal amongst tenants unless otherwise stated in the transfer deed. There are other types of estates in land that are used to prevent the alienation of land (also used in the law of trusts). Generally these are called future interests, an example being the rule against perpetuities.
Real property may not only be owned it may be leased in which the possession of the property is given to the tenant for a limited period of time. Such leases are also called estates such as an estate for years, a periodic tenancy or an estate at will.
Real property may also be owned jointly through the device of the condominium or cooperative.
Economic aspects of real property
Because real property is essential for industry or other activity requiring a lot of fixed physical capital, economics is very concerned with real property and rules regarding its valuation and disposition, and obligations accrueing to its owners. In economic terms, real property consists of some natural capital (or land, one of the factors of production especially in agriculture), and infrastructural capital (the buildings, water and power lines, and other improvements necessary to make real property useful for some human purpose). Other fixed physical assets, indistinguishable economically from infrastructure, such as machines, may be stored on real property and may require natural or infrastructural attributes (such as running water for a turbine or an isolated location to allow loud noise emissions) hard to duplicate even nearby.
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