Real Estate

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Real Estate

Land, buildings, and things permanently attached to land and buildings. Also called realty and real property.

Real estate is the modern term for land and anything that is permanently affixed to it. Fixtures include buildings, fences, and things attached to buildings, such as plumbing, heating, and light fixtures. Property that is not affixed is regarded as Personal Property. For example, furniture and draperies are items of personal property.

The sale and lease of real estate in the United States are major economic activities and are regulated by state and federal laws. The two major types of real estate are commercial and residential real estate. Commercial real estate involves the sale and lease of property for business purposes. Residential real estate involves the sale and rental of land and houses to individuals and families for daily living.

The sale of residential property is heavily regulated. All states require real estate agents and brokers, who earn a commission from the owner of real estate for selling the property, to be licensed. To get a license, a person must have a high school diploma, be at least eighteen years old, and pass a written test on real estate principles and law.

Since the 1970s, home buyers have been given additional protection under the law. Many states and municipalities require a seller of real estate to file a truth-in-housing statement. A seller must disclose any problems with the home, such as a wet basement or the presence of termites, on the form. Failure to disclose this information can result in the revocation of the purchase agreement or a lawsuit by the buyers against the seller for Fraud. In addition, some laws require an inspector to visit the property to determine if there are any problems.

Most purchases of residential real estate require the buyer to obtain a mortgage from a bank or other lending institution. The lending institution receives a security interest on the real estate, which means that if the borrower defaults in paying back the mortgage, the institution can obtain title to the property and resell it to pay off the mortgage debt.

The federal government enacted the Real Estate Settlement Procedure Act of 1974 (RESPA) (12 U.S.C.A. § 2601 et seq.) to ensure that the buyer of residential real estate is made aware of the many costs associated with the sale. RESPA mandates that a federally insured lending institution give the buyer advance notice of all the costs to be paid on the date of closing the transactions. These costs typically include the cost of property surveys, appraisals, title searches, brokers' fees, and administrative and processing charges.

Cross-references

Sales Law.

West's Encyclopedia of American Law, edition 2. Copyright 2008 The Gale Group, Inc. All rights reserved.

real estate

n. land, improvements and buildings thereon, including attached items and growing things. It is virtually the same as "real property," except real property includes interests which are not physical such as a right to acquire the property in the future. (See: real property)

Copyright © 1981-2005 by Gerald N. Hill and Kathleen T. Hill. All Right reserved.
References in periodicals archive ?
The number of homes for sale fell year over year in all other neighboring counties but one: up 24.8 percent in Orleans County to 161 but down 9.8 percent in Wayne County to 296, down 18.1 percent in Genesee County to 118, down 13 percent in Livingston County to 168, and down 25 percent in Wyoming County to 114.
The inventory of homes for sale in Lane County inched up from 1.7 months in March to 1.8 months in April.
Graboske explained that borrowers with low fixed-rate loans are less inclined to list their homes for sale because they don't want to give up the low rates they already have, especially if rates are expected to rise.
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HOUSE prices in Wales and England edged lower during August following a decrease in demand and an increase in the availability of homes for sale, research indicated today.
But despite the fall, which came as the number of homes for sale hit its lowest level for 21 months, house prices are still 1.7% higher than they were 12 months ago.
THE number of homes for sale increased for the first time in four months during August despite the housing market suffering its traditional seasonal slowdown, research showed today.
Summary: House prices have risen for the fourth month in a row as the market continues to be boosted by a shortage of homes for sale.
The number of homes for sale was down slightly, 0.7 percent, from March.Meanwhile, in 29 metropolitan areas nationwide, not including New York City, the supply of homes for sale in April fell 21 percent compared to the same time last year, according to ZipRealty.
If the market is going to stabilize, the inventory of existing single-family homes for sale will play a critical role.