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Chapter 1INTRODUCTION TO
REAL ESTATE

I. CALIFORNIAS REAL
ESTATE MARKET

A. California Bureau of Real

Estate (CalBRE)
Each state has its own real estate
licensing laws.

www.bre.ca.gov
California Bureau of Real Estate

B. Meaningful
Technological Changes in
Real Estate

1. Real Estate Buyers and Sellers Start Online

90% of all buyers searched the web before contacting an agent

2. Realtor.com - Possibly the Most Reliable

Because of its affiliation with NAR, it has access to more

accurate information

3. New Domain Names for REALTORS

Salespeople can create a website and take it with them where

ever they go

4. Social Media

Facebook, Twitter, and Instagram post photos of new listings

online in moments
QR codes give clients instant access on their mobile device

C. High Cost of
California Real Estate

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Californias remarkable tech-oriented economy is due to its

dominance in:

1) creative design, innovation and technology;

2) public investments in a variety of technology areas;
3) private venture capital attracting opportunities in energy efficiency, applying
technology to the health care system, Internet, telecommunications, and
4) market opportunities for Californias exports of goods and services .

There is a scarcity of buildable land in California close to urban

areas, which means the price of real estate will continue to be

higher in California compared to any other state

California real estate market values are continually adjusting

in the aftermath of the Financial Crisis

D. Real Estate: A Profitable4

Profession

With the high cost of real estate comes the

potential for high profits

A COMMISSION is an amount paid, usually

as a percentage of the selling price, to a
broker for services

II. HISTORICAL INFLUENCE

A. Californias Colorful
History

Spanish Rule

In 1769 began famous mission system along

El Camino Real.

Established presidios (fortified trading

posts) at San Francisco and Monterey.

Established pueblos (cities) at Los Angeles

and San Jose.

Mexican Rule - Early 1800s

Territory of U.S. - Treaty of 5

Guadalupe Hidalgo - 1848

California became a possession of the

U.S.

John Sutter discovered gold.

Gold rush brought thousands to

California.

Full California Statehood

- September 9, 1850.

1917 - California passed the

first real estate licensing law,
in U.S.

1917 law ruled unconstitutional.

1919 Real Estate Act upheld by State

Supreme Court.

38 million Californians now make up 12.5% of

the total U.S. population

B. California Land Ownership

45% of all land in California is federal land

Lots of national forest and park land

50 % of land is privately owned

III. REAL AND PERSONAL

PROPERTY

A. Ownership is a Bundle of
Rights
1. Possession
2. Enjoyment
3. Control
4. Disposition

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B. Real Property

REAL PROPERTY is the right or interest that a

person has in the land or anything attached to the
land
1.

Land - (above and below the surface) including littoral and

riparian rights, minerals, oil and gas rights, and airspace
(such as condominiums).

2.

Appropriation of Water
Percolating Water
Allocation and Appropriation of Water
Potable Water
Surface Water Rights

Anything permanently attached or affixed to the land

(Improvements), such as buildings, fences, walls

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B. Real Property (cont.)

3. Anything incidental or appurtenant to the land
(shares of stock in water company, easements).
4. That which is immovable by law (attached by
rootsvegetation, landscaping).

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C. Personal Property
PERSONAL PROPERTY is any property that is

movable and cannot be properly classified

under the definition of real property
1. Anything not defined as real property.

2. Emblements - growing crops cultivated annually

(fruits and nuts).
3. The ownership of personal property is transferred
with a bill of sale.

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D. Fixtures -

Personal property attached to, or

incorporated into, the land in such a
manner as to become real property

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THINK
M.A.R.I.A
5 tests:
1. Method of attachment
2. Adaptability
3. Intention
4. Relationship of the parties
5. Agreement

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E. Trade Fixtures
Always Personal Property.
Removable exception to the rule.
Equipment used in the normal course of

business which is considered personal

property as long as any removal damages
can be repaired.
Transferred by Bill of Sale.

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IV. METHODS OF LAND

DESCRIPTION

Common Address -

doesnt give enough information to properly

describe or locate a property.

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A. Metes and Bounds

(surveyor's map)

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The method of identifying property in relationship to

its boundaries, distances and angles from a given

starting point.
Complicated description that surveyors use.

Metes - a measure of distance between points

(feet, yards, rods and chains)

Bounds - starting points, ending points and

markers in between used to describe boundaries.
a. Natural bounds (rivers, trees, rocks)
b. Man-made bounds (canals, roads, stakes or bench
marks)

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Directions are based upon angles from a

north-south line determined with compass.
a. 360 degrees () on a compass
b. 60 minutes ()in a degree
c. 60 seconds () in a minute

B. Sections and Townships

(U.S. Government Survey)

identifies land by sections and townships

arrived upon by dividing the state into base
lines and meridians.

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The three starting points in

California are:
1.

Humboldt Base Line and Meridian

2.

Mt. Diablo Base Line and

Meridian

3.

San Bernardino Base Line and

Meridian

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1. Base Lines - run east

west from a given starting
point and are marked by
six mile increments called
Ranges.
2. Meridian Lines - run
north-south from a given
starting point and are
marked by six mile
increments called Tiers or
Township Lines, the
resulting grid of squares
divides the state into
Townships, each
containing 36 square miles
(six miles by six miles)

a. Reading Tier & Section

Descriptions

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Each Township is divided into 36 sections.

sections are numbered 1 through 36.

number sequence starts in the upper right-hand

(North-East) corner of the of the township

sequence proceeds across to the left to 6, down to 7,

across to the right to 12, down to 13, etc.

sections can be divided into halves and quarters and

each of these can be halved and quartered (and each
half and quarter can be halved and quartered, etc.)
until the property can be properly described.

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Township and Sections

6

10

11

12

18

17

16

15

14

13

19

20

21

22

23

24

30

29

28

27

26

25

31

32

33

34

35

36

Section numbering starts

in upper right corner

C. Lots, Blocks, and Tracts

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(Recorded Subdivision)

describes property according to an engineer's map

which is approved by the Bureau of Real Estate and
the local city or county and then recorded.

The subdivision map is also referred to as a FINAL

SUBDIVISION MAP
1.

2.

3.

Tract - the name assigned to an individual

subdivision map (it is now generally a number, but
in the past was often a often a word or phrase.
Blocks - individually numbered sections of a tract
separated by roads.
Lots - individually numbered sections of a block.

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REFERENCE TABLE
One ACRE is 43,560 square feet, 4840 square yards.
One SQUARE ACRE is 208.71 feet on each side, but this number is
generally rounded off to 209 feet.
One MILE is 5,280 feet long.
One SQUARE MILE contains 640 acres.
One SECTION is one mile square, containing 640 acres
One TOWNSHIP (standard) is six miles square (36 square miles).
One COMMERCIAL ACRE is an acre minus any required public
dedications.
One ROD is 16.5 feet long (5.5 yards). There are 4 rods, or 66 feet, to one
chain, and 320 rods to a mile.

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Chapter 1 - Summary
California was purchased by the U.S. from

Mexico as part of the Treaty of Guadalupe

Hidalgo

BRE
Real Property (immovable)

Bundle of Rights

Personal Property (movable)

Fixtures M.A.R.I.A.

/ Trade Fixtures

Metes & Bounds

Sections and Townships
Lots, Blocks & Tracts
Subdivision Map