A property right is an interest or entitlement of a person in a property that can be enforced via legal means. These rights allow a person to possess, enjoy, use, and dispose of the property s/he owns. More than one person can have rights in the same property and these rights can be dominant or subservient to each other. It is the owner of the property who has the primary interest in the property and the deciding rights to do as s/he pleases with the property. Properties also come with rights of easements like the right to light, right to air, right of way, etc.
The scope of these rights is derived by jurisprudence developed over the years on this issue and are enforceable by legal systems around the world. These property rights are enjoyed by the owner of the property and can be extended to others provided the extension is with the owner’s approval and subject to usage and custom. This article seeks to explain the concept of property rights and address some questions related to them.
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What are the 4 property rights?
The rights that arise from the possession, use and enjoyment of the property need not be vested in the owner only. They can be vested in a leaseholder or a renter who has leased the property or rented it from the owner. These rights are legal and economic privileges and are the follows:
- The Right to use the good: In this case, residential property is the good or asset that has been to use. It need not be only the owner, but also the lessee or renter who can legally use the property of the owner after remitting or promising to remit the lease amount or rent legally. Thus, the right to use the good is a property right.
- The Right to earn income from the good: As noted from the name of the right, an owner can earn income from his property. In this case, an owner can rent his house or give it on the lease, thus earning income from the good.
- The right to ownership cessation: The owner of the property has the right to transfer the property, gift it, exchange it, or simply abandon it because he has the right to dispose of the property as he deems fit.
- The right to enforce the property rights: As the owner of the property (residential real estate), the owner has a right against the world i.e a right in rem and can enforce such right through the courts of law by instituting a civil suit or a petition in court against the violator of his right. If the court finds such right violated, it will issue an order, directive, judgment, or writ in favor of the owner to enforce such right. Thus, this is the right to seek legal remedy. It follows an ancient legal maxim called “Ubi jus ibi remedium” which means that where there is a right there is a remedy.
What is the difference between owner and co-owner?
There are several types of ownership in real estate properties. Some of the types are sole ownership, joint tenancy, tenancy in common, tenancy by entirety, etc.
- In sole ownership, the type of ownership provides for a single owner, the owner of the entire property. In a joint tenancy, tenancy in common, etc, there are two or more owners who have their respective shares in the property and as such are called co-owners.
- A sole owner has the sole decision-making power when it comes to making decisions on the property. In a joint tenancy (co-ownership) decisions cannot be taken by a co-owner. S/he has to consult the other co-owner when it comes to decisions on the joint property for every co-owner has a proprietary right on the entire property.
- The process of succession could be problematic in sole ownership for when a sole owner dies, his/her legal heirs may have to establish probate to divide the property among them. In a joint tenancy, there is the concept of survivorship where if one co-owner dies, his share and the interest in that share transfers to the surviving co-owner automatically.
What is the strongest form of ownership in real estate and why?
The strongest form of real estate ownership is sole ownership and its strengths are reflected in its advantages:
- This form of ownership allows the sole owner to exercise all rights and privileges over the entire property. The owner can also take all the decisions like using, renting it out, adding improvements, disposal of property, etc. by his/her sole authority over the property.
- A sole owner need not consult with anyone as to what to do with his/her property for all the rights and interest are solely vested in the owner.
- However, a sole owner is also responsible for the property and the only person who can be held liable for any debts incurred on the property.
- As the sole owner, the owner can dispose of the property in any way s/he decides fit.
What is the most common form of ownership in real estate?
There is no predominantly common form of ownership found in real estate. However, the following are some of the common forms of ownership found in real estate:
- Complete control over the property.
- The owner can take all decisions about the disposal of the property.
- The financial liabilities of home loans fall on one person’s shoulders.
- There is no right to survivorship and the transfer of property after the owner’s death is regulated by complex succession laws.
- Joint Tenants are entitled to common ownership rights, right to survivorship, and share in rents and profits in the property.
- There is a lack of freedom to make decisions as the consent of the joint owner is required for decisions on the joint property.
- If one owner has debts, the other owner is also exposed to the risk of creditors.
Tenancy in common:
- The home loan liability is spread over the joint owners in this case.
- There is the freedom to make a decision when it comes to your share of the property.
- There is no right to survivorship. In right to survivorship when one joint owner dies, the property automatically devolves to the surviving joint owners.
Tenancy by the entirety:
- Tenancy by the entirety is a useful type of joint ownership for legally married couples because it protects the joint property from creditors to an extent and has the right to survivorship.
There are some other types of ownership also like Owning Corporation and Community tenancy.
Every property is accompanied by certain property rights that enable an individual or organization to use and draw benefit from the property. These rights are transferable by agreement or law and to a limited extent by usage, convention or custom. There are different types of ownership of real estate properties that allow you to exercise these flights accordingly. Even if you are not the owner of a property, you can enter into a rental or lease agreement with the owner/s to access some of these rights to a limited degree.
Even as a legal heir to an owner, you may be able to access these rights to a limited degree and to the fullest extent once the property devolves onto you. These rights are also enforceable, though that may be subject to a limitation period where despite the continued existence of the right, you may not be able to enforce it against the particular person who violated the right. So, if you face a violation of rights, do not sleep on them. Take legal action before the limitation period ends.