I Love real estate…..the people part….the business piece….the legal stuff
Before I took my real estate classes, I knew I loved the people part of the process. I’ve always had a natural connection to people. I had also always had an entrepreneurial spirit and wanted to own my business. It wasn’t until I started the course work, that I discovered how much I enjoyed the legal aspect of the process almost as much.
The bundle of rights was the first major concept we learned about in real estate course work. This concept really grabbed my attention early on. I believe it helps explain a big part of the process. When you own a piece of property, you own all of it. From the core of the earth to the sky and everything in between is all of yours. You also own a set of privileges that are inherently attached to the property.
Whats in the bundle
When you own a piece of property, you have the right of possession (it’s yours), the right of control (you can do what you want with it), exclusion (you decide who can come on your property and who can’t) disposition (you can transfer ownership temporarily or permanently to who you want).
When is the bundle incomplete
If you purchase and fully own a piece of real property, all of these rights are included. If you have used a mortgage or loan, there are parts of the bundle you have given away in exchange for the money borrowed.
Another example when the bundle may be incomplete is when there is an easement attached to the property. An easement is when you have given someone else the use of of a portion of the property. You still own it, but you (or a previous owner) has given away the right to exclude someone from the property. An easement may be necessary for utilities for a neighborhood (power pole on your property) or a driveway that allows an adjacent property owner to access their land.
If your property is inside of a neighborhood with restrictive covenants, part of your rights as a property owner is limited. The covenants may restrict the size of homes, or the types of structures that can be placed on it. Depending on the details in the recorded restrictions you may limited to building materials, pitch of roof, yard decorations, color of siding and a number of other items.
Your attorney and real estate agent should review the restrictive covenants with you during your due diligence period. If there is something in the restrictions that you can’t agree with, you need to know that before making a decision on purchasing the property. You can learn more in my early video on the due diligence period.
Contact legal counsel
My knowledge of this and other legal concepts is limited in depth but that’s exactly the reason why we have attorney’s involved as part of our team. Your attorney owes you the same level of care in the legal matters as I do with the real estate transaction. Be sure you are relying on them to answer your legal questions.
More to come….
We have 12 more episodes and entries to release before the end of the year. The 12 are going to be a part of a series on the listing process and presentation I use for my clients. I am excited to get these out before the end of the year. We are going to cover every thing from disclosures that you are required to have as part of the process to the timeline involved in getting your home prepared, listed and sold.
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Inner Banks Real Estate
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