Property Ownership and Land Use Controls

This area covers what real property is, the estates it divides into, how several people can hold it, the encumbrances that burden it, how land is described, and the public and private controls on its use. It is worth 15 percent of both exams, about 23 of 150 salesperson questions and 30 of 200 broker questions, because its vocabulary underlies everything else tested.

§ 1.1Real property, personal property, and fixtures

Start with the statutory definition.

Everything else is personal property, movable and transferred by bill of sale, not deed. Ownership runs above and below the surface, so mineral and air rights can be severed and sold apart, the legal skeleton of a condominium (Civ. Code § 829). Land is immobile, indestructible, and unique, the reason courts grant specific performance. Its economic characteristics are scarcity, improvements, permanence of investment, and situs, area preference, the most important influence on value. Crops agreed to be severed before sale are goods, and a tenant may harvest annual crops planted before the tenancy ended (§§ 658, 660).

A fixture is former personal property turned real by permanent attachment (§ 660). Courts weigh the MARIA factors, method, adaptability, relationship, intention, and agreement. Intention controls, and close cases go against the annexor, so a buyer beats a seller and a tenant beats a landlord. A tenant may remove trade fixtures before the tenancy ends if removal does no injury and the item is not integral, or they become the landlord's (§ 1019).

§ 1.2Estates in land

A grant is presumed to convey fee simple absolute unless a lesser estate is stated. A defeasible fee can forfeit title, automatically for a determinable fee or by the grantor's reentry for a fee on condition subsequent. A life estate lasts for a designated life, possibly another's, an estate pur autre vie, with the future interest a reversion to the grantor or a remainder to a third party. The life tenant may rent or mortgage but not commit waste, and any encumbrance dies with the measuring life. The four leaseholds are the estate for years, any fixed term ending without notice, the periodic tenancy, the estate at will, and the estate at sufferance, the holdover who is not a trespasser. A lease is a chattel real, personal property despite being an interest in land.

§ 1.3Liens and the property tax calendar

An encumbrance is any interest held by another that burdens title or limits use, and an encumbered property can still be sold. Liens are the money encumbrances, easements, encroachments, restrictions, and leases the non-money kind. Liens are voluntary (a deed of trust) or involuntary (tax, judgment, mechanics), and specific to one property (property tax, mechanics liens, mortgages) or general (judgment and income tax liens). The property tax lien is specific, attaches at 12:01 a.m. on the January 1 preceding the fiscal year, not the July 1 when the year begins, and outranks private liens whatever their recording date (Rev. & Tax. Code § 2192). The calendar runs on No Darn Fooling Around, penalties running from delinquency, never the due date (Rev. & Tax. Code §§ 2605, 2617, 2606, 2618).

Mechanics lien deadlines are pure timelines (Civ. Code §§ 8204, 8412, 8414, 8460).

A judgment lien arises by recording an abstract of judgment and lasts 10 years from entry of judgment, not recording (Code Civ. Proc. § 697.310).

§ 1.4Easements and private restrictions

An easement appurtenant burdens a servient tenement for a dominant tenement and passes automatically with the land (Civ. Code § 801). An easement in gross, like a utility's, benefits a holder rather than land, so no dominant tenement exists (§ 802). Both are nonpossessory. Easements arise by express grant or reservation, implication, necessity where a conveyance out of common ownership landlocks a parcel, prescription, or dedication. Prescription requires open, notorious, hostile, continuous use for five years, needs no tax payment, and yields use, never title (Code Civ. Proc. § 325). Permission defeats hostility, including the statutory sign posted at entrances or every 200 feet.

Easements end by merger, destruction of the servient tenement, abandonment-type acts, and, for prescriptive easements only, five years of nonuse (Civ. Code § 811). A granted easement survives mere nonuse. A license is revocable personal permission, never ripening into an easement. Recorded covenants in a common interest development are equitable servitudes enforceable unless unreasonable, by the association or any owner, with attorney's fees to the prevailing party (§ 5975), and the stricter of restriction or zoning governs. A covenant restricting ownership by race, religion, or another protected class is void. Adverse possession requires five years of actual, open, hostile, continuous possession plus timely payment of all taxes, yielding title through quiet title (Code Civ. Proc. § 325), and neither doctrine runs against public land (Civ. Code § 1007).

§ 1.5How title is held

Severalty means one owner, even a corporation, despite the sound. Co-ownership takes four statutory forms, joint, partnership, in common, and community (Civ. Code § 682). Tenancy in common is the default, requires only unity of possession, allows unequal shares, and has no survivorship (§ 686). A joint tenancy needs the four unities, time, title, interest, and possession, plus an express declaration, and survivorship passes the interest outside probate and defeats the will (§ 683). One joint tenant may convey unilaterally, severing only that share. Marriage acquisitions while domiciled here are community, while premarital property, gifts, inheritances, and profits of separate property stay separate (Fam. Code §§ 760, 770). Each spouse may will half of plain community property. Survivorship requires title expressly declaring community property with right of survivorship (Civ. Code § 682.1). Both spouses must join to sell, encumber, or lease community real property for over one year (Fam. Code § 1102). Trustees hold legal title and sign conveyances, beneficiaries hold equitable title, and a revocable living trust avoids probate.

§ 1.6Common interest developments

A common interest development pairs separate ownership with shared common area and a mandatory association (Civ. Code §§ 4080, 4100). A condominium owner holds the airspace unit in severalty plus the common area as a tenant in common (§ 4125). Planned development owners hold lots while the association typically owns the common area (§ 4175). A stock cooperative corporation holds title, residents holding shares plus an occupancy lease, never a deed (§ 4190). A community apartment project couples an undivided interest in the whole with exclusive occupancy of one apartment (§ 4105).

Five or more interests trigger the subdivided lands scheme, a public report before marketing, delivered before the buyer is bound, receipt signed (Bus. & Prof. Code §§ 11000, 11018.1). Balcony inspection deadlines, a broker-level recency point, split by statute.

§ 1.7Legal descriptions

Land is described by metes and bounds, by lot and block on a recorded map, or by government survey. An address or assessor's parcel number is not a legal description. Metes and bounds runs courses and distances from a point of beginning and must close, monuments controlling over distances. Lot and block cites a tract map recorded with the county recorder, so the short reference is legally complete. The survey measures from three meridians, Humboldt (northwest), Mount Diablo (most of the north and all of the center), and San Bernardino (south). A township is six miles square, 36 sections of one square mile, 640 acres, each, and an acre is 43,560 square feet. Sections number from 1 in the northeast corner and snake, so 7 lies south of 6. For aliquot parts, multiply the denominators and divide 640 by the product. "Of" nests and multiplies, "and" adds. The S 1/2 of the NE 1/4 of the SW 1/4 is 640 divided by 32, 20 acres.

§ 1.8Government powers and property taxation

Government holds four inherent powers, remembered as PETE, police power, eminent domain, taxation, and escheat. Police power regulates for health, safety, morals, and general welfare, and reasonable regulation owes no compensation, unlike eminent domain.

Condemnation is the proceeding, fair market value the measure, and payment comes first. A taking without condemnation lets the owner sue in inverse condemnation. Escheat sends an intestate, heirless estate to the state (Prob. Code § 6404).

The maximum ad valorem tax is 1 percent of full cash value plus voter-approved debt, the base year value set at acquisition and rising at most 2 percent a year (Cal. Const., art. XIII A). Reassessment at sale or new construction brings the buyer a supplemental bill for the difference (Rev. & Tax. Code § 75.7). Proposition 19, effective 2021, lets owners 55 or older, severely disabled, or disaster victims move their base year value to a replacement primary residence anywhere in the state within two years, up to three times for the first two groups. It confines the parent-child exclusion to a family home or farm becoming the transferee's principal residence, up to taxable value plus $1,000,000, and the old rental exclusion is gone. The homeowners' exemption removes $7,000 of assessed value, saving $70 a year, and is not the homestead (§ 218). Documentary transfer tax is 55 cents per $500 of consideration excluding any remaining lien, so an assumed loan shrinks the taxable amount (§ 11911).

§ 1.9Planning, zoning, hazards, and the homestead

Every city and county adopts a general plan with seven mandatory elements, land use, circulation, housing, conservation, open space, noise, and safety (Gov. Code § 65302), and zoning must be consistent with it (§ 65860). A variance relieves development standards for a lot's peculiar hardship, never a new use, which takes a conditional use permit that runs with the land (§ 65906). A nonconforming use may continue but not expand. The Subdivision Map Act requires a tentative and final map for five or more parcels, generally a parcel map for four or fewer (§ 66426). Environmental review reaches only discretionary approvals, an impact report required when substantial evidence shows a possible significant effect (Pub. Resources Code § 21080).

The Natural Hazard Disclosure Statement flags six zones, federal flood, dam inundation, high or very high fire hazard severity, state responsibility wildland, earthquake fault, and seismic hazard (Civ. Code § 1103.2). The Alquist-Priolo Act governs surface fault rupture, generally a 50-foot setback from an active fault, one ruptured within 11,000 years. Pre-1978 housing carries federal lead-paint duties, disclosure, the pamphlet, and a waivable 10-day inspection window, never abatement.

The homestead shields dwelling equity from judgment creditors, the greater of the prior year countywide median sale price, capped at $600,000, or $300,000, both inflation-indexed since 2022, so learn the formula, not a dollar figure (Code Civ. Proc. § 704.730). The automatic homestead needs no filing. A declaration adds voluntary sale proceeds protection and blocks later judgment liens, except surplus and support (§§ 704.950, 704.960). Proceeds stay exempt for six months (§ 704.720), and no homestead defeats a deed of trust the owner signed, a mechanics lien, or a tax lien.