Real Estate Principles and Practices
Core concepts
Real estate practice rests on connected ideas: rights in land (surface, air, subsurface), estates (fee simple absolute, life estate, leasehold), and how title is held (severalty, tenancy in common, joint tenancy, tenancy by the entirety). Title passes by deed, but a deed is valid only when delivered and accepted; recording protects priority, not validity. Encumbrances-easements, liens, covenants, encroachments-burden title or run with the land, while a license is personal and revocable.
Agency and contracts
Agency is fiduciary: loyalty, obedience, disclosure, confidentiality, accounting, and reasonable care. A listing agreement creates agency between broker and seller; a salesperson works under the broker. Questions love dual agency, designated agency, and the moment a customer becomes a client. Contracts need offer, acceptance, consideration, capacity, legality, and a legal description; contingencies (financing, inspection, appraisal) suspend the duty to perform.
Traps
Easement appurtenant vs. in gross; joint tenancy's survivorship vs. tenancy in common; "the listing agent represents the seller" even when a buyer calls. Do not confuse recording with validity. A lease is both a contract and a conveyance of a leasehold estate. Fair housing covers housing, not just sales.
Worked example
A seller agrees to pay 6% on a $250,000 sale, split 60/40 between listing and selling brokers. Gross commission = $250,000 × 0.06 = $15,000. Listing broker = $15,000 × 0.60 = $9,000; selling broker = $6,000. If the selling salesperson has a 50/50 split, she receives $3,000. Rule of thumb: compute commission on gross sale price before deducting closing costs.