Real estate exam terms
8 terms, each with a plain definition, the term it is most often confused with, and how the license exam actually asks about it.
A right or improvement that belongs to land and transfers with it
Something attached to the ownership of a parcel rather than to the owner personally: an appurtenant easement, water rights, a shared driveway right, a parking space deeded to a condominium unit. It passes with the land whether or not the deed lists it.
The phrase "runs with the land" is the flag. Anything appurtenant travels to the next owner automatically.
Another word for personal property
An older term still in wide use, particularly in the phrase "chattel mortgage" — a loan secured by personal property rather than by real estate. Manufactured housing not permanently affixed to land is often financed this way.
Recognizing the word is most of the item. If a question uses "chattel", it is talking about something that is not real estate.
Personal property that has become part of the real estate by attachment
A ceiling fan in a box is personal property; bolted to the ceiling it is a fixture and conveys with the house unless the contract says otherwise. Courts look at the method of attachment, adaptation to the property, the parties’ intention and any agreement between them.
The intention test is what makes this examinable rather than obvious. The reliable answer to disputes is that the contract should have said — which is why the exam rewards knowing that anything ambiguous belongs in writing.
Movable property; everything that is not real property
Also called chattel or personalty. It moves with the owner rather than with the land, and it transfers by bill of sale rather than by deed — which is the practical fact behind most of the exam questions about it.
Conversion runs both ways and the exam tests both: severance turns real property into personal (cutting timber), annexation turns personal into real (planting a tree, bolting a mirror).
Land, everything permanently attached to it, and the rights that go with it
Real property is the land itself, the improvements on it, whatever is beneath and above it, and the legal rights of ownership — the bundle of rights. It is defined by permanence and by immobility.
Realty and real estate are used interchangeably with it. Watch for questions distinguishing the physical land from the rights: a bundle-of-rights question is asking about the legal side.
Turning real property into personal property by detaching it
Cut down a standing tree and the timber becomes personal property; mine ore and it becomes personal property. The reverse process is annexation or attachment, which converts personal property into part of the real estate.
Paired with annexation and with the fixture rules. A severed item can still be sold with the land, but it is being sold as goods rather than as realty.
The right to the earth beneath the surface of a parcel
Part of the bundle that comes with land, and severable from it: an owner can sell or lease what lies below while keeping what sits on top. Once they are severed the surface owner and the subsurface owner are different people with different rights in one parcel.
Paired with air rights and surface rights as the three vertical layers. Severance is the examinable idea — split them and they travel separately from then on.
An item a business tenant attaches to conduct their trade, and may remove
Restaurant hoods, salon chairs, bank vaults, shop shelving. Attachment would normally convert them into fixtures, but the law makes an exception for business tenants so commerce is not penalised for fitting out a space. The tenant must remove them before the term ends and repair any damage caused.
Two conditions carry most of the questions: the tenant must be using them for a trade or business, and leaving them past the end of the term can forfeit them to the landlord.
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