Real Estate Government Powers

Introduction

• Topics covered: Police Power, Eminent Domain, Taxation, Escheat.
• Important for examinations.

Police Power

Components

• Policing Power: Not just arresting authority, includes:
  • Inspectional services
  • Building department
  • Health department
  • Zoning and planning commissions
• Enabling Acts: Federal government enables state governments, which in turn enable local governments.

Comprehensive Planning

• Also known as the Master Plan.
• Developed by a Planning Commission, approved by City Council.
• Focuses on:
  • Land use (commercial, residential)
  • Housing needs for residents
  • Revitalization of neighborhoods
  • Development of utilities, schools, parks, etc.
  • Environmental considerations

Zoning

• Regulatory tool to achieve the Master Plan.
• Local determination, no nationwide/statewide zoning ordinances.
• Aims to achieve harmony in surroundings and sustain property value.
• Setback Requirements: Minimum distance between structures.
• Snob Zoning: Zoning used to restrict certain developments; can lead to discrimination.

Vocab and Concepts

• Grandfathering: Existing uses continue despite zoning changes.
• Variance: Exception to zoning rules.
• Special/Conditional Use Permit: Allows specific uses like home businesses.

Eminent Domain

• Government's constitutional right to take private land for public use.
• Condemnation: Process of taking land.
• Compensation: Required payment to property owners.
• Involuntary alienation: Government can take private land, but not vice versa.

Taxation

• Important government power.
• Ad Valorem Tax: According to value; general real estate taxes.
• Special Assessment Tax: For specific improvements (e.g., sidewalks).
• Taxes can lead to super liens on properties if not paid.

Mortgage and Taxation

• PITI: Principal, Interest, Taxes, Insurance.
• Taxes paid by banks to maintain lien priority over government.

Escheat

• Government's right to claim property if owner dies intestate (without a will) and has no heirs.
• Property reverts to government, which pays off creditors and absorbs profits.
• Type of involuntary alienation.

Conclusion

• Covered all government powers affecting real estate: Police Power, Eminent Domain, Taxation, Escheat.
• Next topics include Freehold Estates, Leasehold Estates, and Encumbrances.