How Easements Could Affect Your Property Rights
As a new homeowner, you may expect that the land on which your home sits is exclusively yours. After all, owning real estate versus renting or leasing significantly expands your property rights. However, you might be surprised to learn that owners cannot do whatever they wish with their property. That’s why it’s important to learn about easements and how they can impact your rights.
An easement is a written or verbal agreement between the owner of a piece of land and another entity, where the owner grants the entity rights or use of their property in one way or another. In other words, an easement gives a person, organization, business, or government agency permission to use or access your land for a specific purpose.
When purchasing a home, it’s important to know about any easements that may affect your lifestyle or future home value. Millions of American homes currently have easements to allow for utility companies to operate. It’s easements that allow plumbing companies to bury pipes under a home or electric companies to install equipment on private property.
Getting to Know Common Types of Easements
An easement is created when a property owner is approached for permission to use his or her land. Such agreements, which may be temporary or permanent, are made official with a legal document such as a deed. The homeowner who originally grants the easement may be compensated, although subsequent homeowners typically are not.
The three main categories of easement agreements are:
Easement In Gross
An easement that applies only to the particular party to whom you’ve decided to let access the property. When that party sells the property, the future owner is not included in the easement particulars. With an easement in gross, you give a person permission to use your parcel of land in some specific way. For instance, you let your neighbor park his car on your driveway.
Easement Appurtenant
An easement that is attached to the land and therefore is part of any sale and subsequently transferred to the new owner. This type of arrangement arises when one property relies on your land to remain viable. For example, say the only access to a public beach is a path that crosses your land. The easement would prohibit you from obstructing access to and along the path and may also hold you responsible for maintaining it.
Prescriptive Easement
Also known as an involuntary easement, this is created when a person without an ownership interest in the property and without the permission of the property owner (a trespasser) continually and openly uses a portion of the property for a specific reason. For instance, this type of easement may arise if locals use a portion of your land as a shortcut for a long period of time without your objection, in order to access a nearby school. After more than 15 years of use, they may acquire a right to continue to do so.
Other Types of Easement Agreements
An easement of necessity, when someone has no choice but to use your land — such as when the only way they can access their home is via your yard — and utility easements, as mentioned above.
Private easements are created between neighbors, who may need access to one another’s land, whereas public easements generally apply to governments and homeowners’ associations. Finally, a negative easement prevents something from happening or being built, such as denying you the right to build a pool because it interferes with your neighbor’s property.
If you receive money for easement rights, it’s usually taxable income. Temporary easements typically count as rental income and are taxed at the same rate as regular income, while permanent easements count as capital gains income. If a court finds that an easement is being accessed beyond reasonable use or substantially interferes with the landowner, it can usually be terminated.
It’s always best to talk to a qualified real estate attorney to determine when other parties are allowed to use your property, what accommodations you may have to make, and what recourse you have to end specific easements. In addition, it’s necessary to hire a real estate attorney when setting up or terminating an easement.
Vanguard Leaves No Stone Unturned in Your Title Search
At Vanguard Title, we know buying a home is one of the most important decisions you’ll ever make, so we strive to make your overall experience a positive one. This includes thoroughly checking all sources to see what easements exist. With Vanguard’s staff of local industry professionals working on your behalf, you can rest easy, knowing we’ll assure a smooth and seamless process for your closing transactions.