Estimating the value of the real property is necessary for a variety of endeavors, including financing, sales listing, investment analysis, property insurance, and taxation. But for most people, determining the asking or purchase price of a piece of property is the most useful application of real estate valuation. This article will provide an introduction to the basic concepts, factors, types, and joint tenancy.
REAL PROPERTY DESCRIPTION
Real property is defined as the land and every asset that is permanently attached to it. With real estate possession, all types of rights come to the owner. The real estate owner has the right to possess, sell, lease, and enjoy the land.
The term is historic, arising from the now-discontinued form of action, which distinguishes between real property disputes and personal property disputes. Personal property was and continues to be, all property that is not real.
Few examples are crops, buildings, machinery, wells, dams, ponds, mines, canals, and roads.
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FACTORS THAT AFFECT REAL PROPERTY
Undoubtedly, it is a fact that there are certain uncontrollable factors that affect your real estate value. The external factors will affect everything from your real estate value, to the optimal rental strategy, to your potential return on investment. You need to be aware of the factors which affect the value of your real estate.
EXTERNAL FACTORS
When looking at the factors that affect, the external factor stands out. External changes that take place nearby will directly affect the real estate value. Real property is vulnerable to externalities due to its immobile nature. For example, the noises that neighboring people and construction sites produce devalue your property.
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TYPES OF ESTATES IN LAND
Estates in the land are an individual’s legal rights or interest in a property. To be in an estate in land, the interest must become possessory at some point in time. In other words, an easement, which is non-possessory is not an estate inland. Nor is a license. Additionally, duration is used to measure the estate in land ownership.
There are two different types, and the determining feature is related to the ownership of real estate. Does the person with the right own the real estate, or are they merely leasing it? If they own the real estate, they would have a freehold estate. If they lease the real estate, they would have a leasehold estate.
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JOINT TENANCY IN REAL estate
A joint tenancy is a property owner type that is associated with real estate. Two or more parties come together at the same time to make a legally binding agreement with one another through a deed. These parties may be relatives, friends, or even business associates. For example, let’s say an unmarried couple purchases a house. At the time of purchase, they opt for joint tenancy. The deed to the property will name the two owners as joint tenants.
TO SUM UP
Accurate real property valuation is important to mortgage lenders, investors, insurers and buyers, and sellers of real estate property. While appraisals are generally performed by skilled professionals, anyone involved in a real transaction can benefit from gaining a basic understanding of the different methods of real estate valuation.
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