ACEABLE AGENT MICHIGAN REAL ESTATE SECTION #1 PRACTICE TEST QUESTIONS AND ANSWERS.

Real Property real estate plus the rights of ownership Land the surface of the earth, including all permanently attached natural features, extending downwards to the center of the earth and upwards to infinity. real estate land plus all improvements made by man or nature Bundle of Rights The rights of an owner to possess, control, enjoy, sell, lease, mortgage, and dispose of the property. Bundle of Rights terms Exclusion, possession, quiet enjoyment, control and disposition Personal Property any unattached, movable asset on the property not considered real estate (land plus improvements); also known as chattel or personalty Improvement any non-natural structure built on or affixed to land Property Types Residential, commercial, industrial, agricultural and special purpose asset a tangible or intangible item of value Equity the portion of a property's total value owned outright by the holder to title, equal to the difference between the market value and all outstanding debts on the property Common Law the side of law which arises from judgments and decisions made in courts rather than explicit legislation legal title complete legal ownership of real property and the bundle of rights associated Quiet Enjoyment a lessee's right to possess a property without interference from lessor, previous owner, or anyone else about the claim to the title exclusion a right included in the bundle of legal rights to real property which empowers the owner to allow or deny others' use of the property Chattel any unattached, movable asset on the property not considered real estate (land plus improvements); also known as personal property or personalty Land - Physical Characteristics Indestructible, immobile, non-hemogenous Land - Economic Characteristics Scarcity Situs Modification Fixity Illiquidity Scarcity The supply of land is finite situs People prefer land for its location, both for natural and human-made reasons Modification Human-made improvements can affect the value of land Fixity An economic characteristic of land stating that land, buildings and improvements are considered a fixed investment - not liquid assets Illiquidity an inability to convert assets into cash quickly Air Rights The right to use, control and occupy the space above a particular parcel of land and can be sold. Surface Rights the rights to access the surface area of a parcel of real property and govern what happens on the surface of the land, and include natural elements and improvements. Subsurface Rights (or mineral rights) deal with what's beneath the surface, and can also be sold separately. Subsurface right holders have priority over surface right holders, so long as the surface isn't being disturbed. Supporting rights a property owner's right to not have their land slide around because of what a neighbor is getting up to. Lateral support comes from adjacent properties and subjacent support is from below. Water Rights are broken into riparian rights (for flowing bodies of water) and littoral rights (for still bodies). These rights are determined by states and even municipalities. accrection the process that results in the gradual increase in land area through deposits of soil by natural forces Mineral Rights (or subsurface rights) deal with what's beneath the surface, and can also be sold separately. Subsurface right holders have priority over surface right holders, so long as the surface isn't being disturbed. Riparian Rights rights that govern the use of flowing water, such as rivers and streams that pass through or border a property Littoral Rights rights that govern lakefront or oceanfront property and usually allow the property owner to use the water bordering their property Prior Appropriation the legal doctrine which grants states the power to control and regulate all water resources within their borders fee simple absolute estate the fullest and most complete set of ownership rights one can possess in real property (infinite duration, freely transferable, freely inheritable) defeasable fee estate/qualified fee Defeasible fee estate/qualified fee (estate ends if qualified event takes place) -Fee simple determinable -Fee simple subject to condition subsequent Fee Simple Determinable a type of fee simple defeasible estate which causes the title to automatically revert to the original owner if the deed requirements regarding property use are violated Fee Simple Subject to Condition Subsequent previous owner can go to court to regain estate after event happens Life Estate estate for duration of individual's life -Conventional -pur autre vie -legal Estate for years definite ending period and no automatic renewal; no notice is required to terminate Periodic estate automatically renews at the end of each pre-determined time period until canceled by either party Estate at will undetermined, lasts until either party decides to end it Tenancy at sufferance tenant remains in possession of property beyond lease term without landlord permission Leasehold Estates Estate at Will Periodic Estate Tenancy at sufferance Estate for years Freehold estates a form of ownership with an indeterminate length Fee Simple Defeasible a property interest characterized by perpetual ownership on the condition that the property is used for a certain purpose or under specific conditions - ownership reverts back to the original owner if these stipulations are violated revisionary interest the transfer of title from the holder back to the original grantor