Real property: Overview, definition and example
What is real property?
Real property refers to land and any permanent structures or fixtures attached to it, such as buildings, homes, or other improvements. Real property also includes natural resources on or under the land, like minerals, water, or crops. It differs from personal property, which includes movable assets such as furniture, vehicles, or equipment. Real property is often subject to legal agreements such as leases, sales contracts, and mortgages.
For example, a residential home, the land it sits on, and any attached buildings or infrastructure (e.g., a garage or fence) are all considered real property.
Why is real property important?
Real property is important because it is typically one of the most significant assets individuals or businesses own. It provides economic value, serves as a place of residence or business operations, and can appreciate over time. Legal rights associated with real property, such as ownership, leasing, and usage rights, are fundamental in real estate transactions and legal disputes.
In contracts, real property clauses are crucial for defining rights, responsibilities, and terms related to property ownership, rental, or development. Ensuring proper legal documentation and agreements related to real property is essential for protecting ownership and usage rights.
Understanding real property through an example
A person purchases a house along with the land it sits on. The contract specifies that the sale includes not only the house itself but also the surrounding land, any outbuildings, and other permanent fixtures such as a swimming pool or driveway. This agreement establishes the buyer’s ownership of the real property.
An example of a real property clause
Here’s how a real property clause might appear in a contract:
“The Seller agrees to transfer ownership of the real property located at [Insert Address], including the land and all permanent structures attached to the land, such as the house, garage, and fencing. The property shall be transferred free of any liens, encumbrances, or claims, except as disclosed in this Agreement.”
Conclusion
Real property refers to land and anything permanently attached to it, such as buildings and natural resources. It is an essential part of personal and business assets and is typically governed by specific legal agreements and rights. Clearly defined real property clauses in contracts help ensure that ownership, usage rights, and responsibilities are clearly understood and enforceable. These clauses provide legal clarity in transactions and disputes involving land and property.
This article contains general legal information and does not contain legal advice. Cobrief is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.