Real Estate Definitions

ACCEPTANCE: All parties have signed the offer.

ACCESSION: Acquiring title to additions or improvements to real property as a result of the annexation of fixtures or the accretion of alluvial deposits along the banks of streams or rivers.

ACCRETION: The increase or addition of land by the deposit of sand or soil washed up naturally from a river, lake or sea. Opposite of erosion.

ADDENDUM: A supplement or addition to a contract made part of the contract by reference before it becomes binding.

ADVERSE FACT: Condition or occurrence generally recognized as significantly reducing the value of real estate, the structural integrity of improvements to real property, or presenting a significant health risk to occupants of the property.

ADVERSE POSSESSION: The actual, open, notorious, hostile and continued possession of another's land under a claim or title. Possession for a statutory period may be a means of acquiring title.

AIR LOT: A designated airspace over a piece of land. An air lot, like surface property, may be transferred.

AIR RIGHTS: The right to use the open space above a property, usually allowing the surface to be used for another purpose.

AGENCY: The relation of agent and principal.

AGENT: A person who represents the interests of someone called a principal in dealings with third persons.

AMENDMENT: Any change to the original terms of a document after it becomes a contract.

ANNEXATION: A process where an item of personal property has become part of the real property because a landowner installed it on the real property.

APPURTENANCE: A right, privilege, or improvement that belongs to and passes with land.

ASSIGNMENT: The transfer of rights and/or duties under a contract.

BASE LINES: Imaginary lines running east-west (latitude) which intersect with lines running north-south (longitude) to form the starting points in the rectangular survey of land descriptions.

BENCHMARK: Usually bronze markers, placed by the U.S. Coast & Geodetic Survey, used as a reference point by surveyors to locate a parcel of land and to indicate the elevation above sea level.

BILATERAL CONTRACT: A contract in which each party to the contract promises to perform some act or duty in exchange for the promise of the other party.

BINDER: A short purchase contract used to secure a real estate transaction until a more formal contract can be signed.

BREACH: Failure to fulfill one's duty as required by law. Failing to comply with the terms of a contract.

BROKER: A person or legal entity licensed to act independently in conducting a real estate brokerage business.

BROKERAGE: The bringing together of parties interested in making a real estate transaction.

BUNDLE OF LEGAL RIGHTS: The concept of land ownership that includes ownership of all legal rights to the land.

CAPITAL GAIN: The profit realized from the sale or exchange of an asset, including real property.

CAVEAT EMPTOR: "Let the buyer beware."

CHATTEL: An item of personal property.

COINSURANCE CLAUSE: A provision in a homeowner's insurance policy which usually requires the owner to maintain insurance equal to at least 80 percent of the replacement cost of a dwelling.

COMMON ELEMENTS: Those parts of a condominium development which are owned by all of the unit owners, such as grounds, recreation facilities or hallways. LIMITED COMMON ELEMENTS are those parts owned by all owners, but controlled and possessed by one owner (patio, balcony).

COMMUNITY PROPERTY: Each spouse has an equal interest in all property acquired by their joint efforts during the marriage. Upon the death of one spouse, one-half of the community property passes to their heirs. The other one-half is retained by the surviving spouse.

CONCURRENT OWNERSHIP: Ownership by two or more persons at the same time.

CONDOMINIUM: The absolute ownership of a unit in a single or multi-unit building based on a legal description of the airspace that the unit actually occupies, plus an undivided interest in the ownership of the common elements which are owned jointly with the other condominium unit owners.

COOPERATIVE: A residential multiunit building whose title is held by a trust or corporation that is owned and operated for the benefit of persons living within the building, who are the beneficial owners of the trust or stockholders corporation, each possessing a proprietary lease.

CURTESY: The legal right of a widower to a portion of his deceased wife's real property.

DATUM: A level surface from which elevations are measured. Surveyors use New York harbor as mean sea level.

DEED RESTRICTIONS: Provisions placed in deeds to control how future owners may or may not use the property.

DEFERRED MARITAL PROPERTY: Refers to all property acquired during a marriage by those parties who were married and living in Wisconsin before the determination date:

DETERMINATION DATE: The last of the following to occur: 1) Marriage, 2) 12:01am on the date of establishment of a marital domicile in Wisconsin, 3) 12:01am on January 1, 1986.

DOWER: The legal right of a widow to a portion of her deceased husband's real property.

DUAL AGENCY: Representing both parties to a transaction. This is unethical unless it is disclosed to both parties and they agree to it in writing.

EASEMENT: The right or privilege one party has to use land belonging to another for a special purpose not inconsistent with the owner's use of the land.

EASEMENT BY NECESSITY: An easement created by law as necessary for the full enjoyment of a parcel of real estate.

EASEMENT BY PRESCRIPTION: An easement acquired by long continuous use. If a person uses another's land for a sufficient period of time, the owner may not be able to prevent continued use.

EASEMENT IN GROSS: An easement given to a person or business. No dominant estate exists, only a servient estate.

EGRESS: The ability to exit a parcel of land.

EMBLEMENTS: Annual crops (fructus industriales).

EMINENT DOMAIN: The right of government to acquire private property for a public use or purpose.

ENCROACHMENT: The unauthorized intrusion of a building or other improvement onto another person's land.

ENCUMBRANCE: An impediment to a clear title, a cloud on the title, such as a lien, lease, or easement.

EQUITY: The market value of a property less the debt against it.

EROSION: The gradual wearing away of land by water, wind, and general weather conditions. Opposite of accretion.

ESCHEAT: The legal rights or claim of government to ownership of property which is left by a deceased property owner who leaves no will (dies intestate) and dies without descendants or heirs.

ESTATE IN LAND: The degree, quantity, nature, and extent of interest that a person has in real property.

ESTOPPEL: Method of creating an agency relationship in which someone states incorrectly that another person is his/her agent, and a third person relies on that representation.

EXPRESS AGREEMENT: An oral or written contract in which the parties state the contract's terms and express their intentions in words.

FEE SIMPLE: The greatest and most complete interest in land with absolute ownership of real property. Also called fee simple absolute.

FEE SIMPLE DEFEASIBLE: Is qualified and may be lost on the occurrence or nonoccurrence of a specified event. Also called fee simple determinable.

FIDUCIARY: One who acts in a position of confidence or trust and has a special legal relationship with the beneficiary.

FIXTURE: An item of personal property that has been converted to real property by being permanently affixed to the land or structures.

FRAUD: A misrepresentation of a material fact which is made with knowledge of its being false and with intent to deceive a party who in fact relies on the misrepresentation to his/her detriment and injury.

FREEHOLD ESTATE: An estate in land in which ownership continues for an indefinite period of time.

FRUCTUS INDUSTRIALES: Fruits of labor, annual crops, generally considered personal property.

FRUCTUS NATURALES: Fruits of nature, such as perennials, trees, grass, usually considered real property.

FUTURE INTEREST: A present ownership interest or possibility of ownership in land, with the right of possession postponed into the future.

GENERAL AGENT: One who is authorized to represent the principal in a range of matters and may bind the principal to any contracts within the scope of his/her authority.

GOVERNMENT SURVEY: Original survey of the state by the U.S. government.

HEIRS: The persons who take property at death of an owner who dies without a valid will.

HOMEOWNERS INSURANCE POLICY: A standardized package insurance policy that covers a residential real estate owner against financial loss from fire, theft, public liability, and other common risks.

HOMESTEAD: An estate in land occupied as a residence.

IMPLIED AGREEMENT: A contract under which the agreement of the parties is demonstrated by their acts and conduct.

IMPROVEMENTS: Any structure, usually privately owned, erected on a site to enhance the value of the property. Also, a publicly owned structure added such as a curb or sidewalk.

INGRESS: The ability to enter a parcel of land.

JOINT TENANCY: A form of co-ownership of property with rights of survivorship.

LAND: The earth's surface extending downward to the center of the earth and upward infinitely into space, including things permanently attached by nature, such as trees and water.

LAW OF AGENCY: The relationship between a principal and an agent.

LEASEHOLD ESTATE: An estate for a fixed term.

LICENSE: A personal privilege to go upon the land of another for a specific purpose.

LIFE ESTATE: An interest in real estate limited to the lifetime of the life tenant.

LISTING AGREEMENT: An employment contract generally between an owner (principal) and a real estate broker (agent) by which the broker is employed as agent to find a buyer for the owner's real estate on the owner's terms for which service the owner agrees to pay a commission.

LITTORAL RIGHTS: Landowner's claim to use water in large lakes and oceans adjacent to his/her property. The ownership rights to land bordering these bodies of water up to the high water mark.

LOT AND BLOCK: A method of legal description used when a surveyor's plat map is filed with the register of deeds in the county where the land is located.

MARITAL PROPERTY: All property acquired during a marriage, unless individual property.

METES AND BOUNDS: To describe a parcel of land by starting from a known point and following the outside boundaries, giving direction and length of each side.

MIXED PROPERTY: Mixing marital property with individual property.

MONUMENTS: Fixed natural or artificial objects used to establish real estate boundaries for a metes and bounds description.

MUD's: Mixed Use Development. Combines office space, stores, theaters, apartment units.

NEGATIVE EASEMENT: An easement which limits the use of land by its owner due to the effect that the use may have on the land of another.

NON HOMESTEAD: Property owned but not used as the owner's dwelling place.

OSTENSIBLE AGENCY: A principal gives a third party reason to believe another person is his/her agent; other person is unaware of the appointment.

PARTITION: A division of real estate held by co-owners which results in each of the parties holding individual or severalty ownership if the property is sold and the proceeds are divided according to the percentage share of the parties.

PERSONAL PROPERTY: Items called chattels that do not fit into the definitions of real property; moveable objects.

PLAT: A plan or map of land showing its subdivision into smaller parcels or lots.

POINT OF BEGINNING: Used in metes and bounds written descriptions; a definite starting point that proceeds around a boundary and arrives back at the point of beginning.

POLICE POWER: The government's right to impose laws, statutes and ordinances, including zoning ordinances and building codes to protect the public health, safety, and welfare.

PRINCIPAL: A main party to a transaction, the person for whom the agent works. The principal is the client.

PRINCIPAL MERIDIAN: The north-south line from which townships are numbered east or west in the government survey of the state.

PRIOR APPROPRIATION: A concept of water ownership in which the landowner's right to use available water is based on a government administered permit system.

PROBATE: The legal process by which a court determines the assets of a deceased person and who will inherit the assets.

PROCURING CAUSE: The effort that brings about the desired result.

PROPRIETARY LEASE: Document received by the owner of a cooperative giving him/her right to the unit.

PUD's: Planned Use Development. Master planned communities zoned under special cluster zoning ordinances that allow them to make maximum use of open space by reducing lot sizes and street areas. A community association formed as a corporation maintains common areas through fees paid by homeowners, but the owners have no direct ownership interest in the common areas.

PUFFING: Exaggerated comments or opinions.

PUR AUTRE VIE LIFE ESTATE: An interest in land measured by the life of a person other than the grantee.

RANGE LINES: Lines that run north and south and are measured from the principal meridian. Used in the rectangular survey system.

RATIFICATION: Method of creating an agency relationship in which the principal accepts the conduct of someone who acted without prior authorization as the principal's agent.

READY, WILLING, AND ABLE BUYER: One who is prepared to buy the property on the seller's terms and is ready to take positive steps to consummate the transaction.

REAL ESTATE: Land at, above, and below the earth's surface, including all things permanently attached to it, whether natural or artificial.

REAL ESTATE BROKER: A person licensed to act independently in conducting a real estate brokerage business; one employed to negotiate the sale, exchange, purchase, or rental of an interest in real estate for others for compensation.

REAL ESTATE SALESPERSON: A person employed by a real estate broker to negotiate the sale, exchange, lease, or rental of real property for others for compensation, under the direction, guidance, and responsibility of the employing broker.

REAL PROPERTY: Real estate plus the bundle of legal rights.

REALTIST: A member of the National Association of Real Estate Brokers (NAREB).

REALTOR: A member of the National Association of Realtors (NAR).

REIT: Real Estate Investment Trust. Pooled money of many investors for the purchase of real estate.

REMAINDER INTEREST: What is left from a life estate.

REPLACEMENT COST: The cost at current prices and construction methods of building an improvement having the same or equivalent usefulness as the subject property.

REVERSIONARY INTEREST: The future interest that reverts to a grantor to his/her heirs.

RIPARIAN RIGHTS: The right of a landowner whose land borders a river or stream or small lake to enjoy and use that water.

SALES ASSOCIATE: A salesperson or broker employed by a broker to list, negotiate, sell, or lease real property.

SECTION: An area of land one mile square, division of a township consisting of 640 acres.

SERVIENT TENEMENT: Land on which an easement exists in favor of an adjacent property.

SEVERALTY: Ownership of a property by one person only - sole ownership.

SEVERANCE: Changing an item of real estate to personal property by detaching it from the land or structures.

SITUS: The location or site of real property.

SPECIAL AGENT: One who is authorized by a principal to perform a single act or transaction. A real estate broker is usually a special agent authorized to find a ready, willing, and able buyer for a particular buyer.

SUBAGENT: One who is employed by a person already acting as an agent.

SUBDIVISION PLAT: A detailed map of the area giving complete metes and bounds descriptions of all parcels of land within the area. This must be recorded in the office of the register of deeds in the county where the land is located.

SUBROGATION: The substitution of one creditor for another with the substituted person succeeding the legal rights and claims of the original claimant.

SUBSURFACE RIGHTS: Ownership rights in a parcel of real estate to the water, minerals, gas, oil, etc. that lie beneath the surface of the property.

SURFACE RIGHTS: Ownership rights in a parcel of real estate that are limited to the surface of the property and do not include the air above it or minerals below it.

SURVEY: The process by which a parcel of land is measured and its area is ascertained.

SURVIVORSHIP: The distinguishing feature of joint tenancy by which on the death of the joint tenant, the surviving tenant or tenants acquire full ownership.

TAXATION: The process by which a government or municipal quasi public body raises monies to fund its operation.

TENANCY BY THE ENTIRETY: A special form of joint tenancy limited to husband and wife, which places all of the legal ownership of the tenancy into the marital unit.

TENANCY IN COMMON: An interest in real estate held by two or more persons without right of survivorship.

TENANCY IN SEVERALTY: Ownership by one person alone.

TIME SHARE OWNERSHIP: A form of ownership interest that may include an estate interest in property and which allows the use of the property for a fixed or variable time period.

TOWNSHIP: An area of land six miles square, or 36 square miles, the largest division of land in a government survey.

TRADE FIXTURE: A fixture which remains personal property and which is installed by a commercial tenant at his/her own expense for us in the trade or business under the terms of a lease and removable by the tenant before the lease expires.

TRUST: Title to property is held by a trustee who controls and manages it for the benefit of another, called a beneficiary.

UNDIVIDED INTEREST: Ownership by two or more persons that gives each the right to use the entire property.