Real Estate Principles: Subdivisions and Other Public Controls

The Subdivision Map Act

* Requires the mapping of all new subdivisions. Regulates the DIVISION of 2 or more lots for the purpose of selling, leasing, or financing said lots. * Administered by local officials, and focuses on the streets, design of the subdivision, the sewers and other physical aspects

Subdivision regulations:

* Subdivided land projects that are located in another state do NOT need to have a public report from the Commissioner. * Out-of-state subdividers must include disclosures in both advertising and sales agreements. * A true copy of ANY advertising material proposed for use for a land project offering must be submitted as part of the documentation required BEFORE the public report is issued.

The Subdivided Lands Act

*Designed to protect the purchasers of property in new subdivisions from fraud of misrepresentation when these purchasers are buying subdivided land. *A subdivision is defined as a division of land into 5 or more lots for the purpose of selling, leasing or financing. *Before each lot in a new subdivision may be sold, the subdivider must deliver a copy of the Commissioner's public report to the prospective buyer, who must then sign a statement attesting that he has read the public report. This statement must be kept on file by the subdivider for 3 years. *The public report is valid for 5 years. Should a material change in the subdivision occur, then an amended public report must be issued by the Commissioner. *A preliminary public report gives the subdivider the opportunity to take reservations for a purchase, pending the approval and issuance of a public report.

California has 3 sets of base lines and meridians:

1. The Humboldt Base Line and Meridian in the northwestern part of the State; 2. The Mt. Diablo Base Line and Meridian in the central part of the State; and 3. The San Bernardino Base Line and Meridian in the southern part of the State.

QUIZ: 8 of 10 Veronica has recently completed her surgical residency and is tired of paying rent. She needs a residence that is very low maintenance due to her grueling surgical schedule. Condos and Stock Cooperatives (co-ops) have both been high on her list. Help Veronica differentiate between these two residential options.

A condominium buyer receives a fee interest, or deed, to her unit. A stock cooperative is a corporation formed to own the land. Veronica would not receive a grant deed, but does share in the corporation and the right to occupy a specific unit.

QUIZ: 7 of 10 Alex, a Nevada developer, has a very large development of attached retirement villas. He is interested in advertising this development in California. Alex has previously advertised and sold condos in his Arizona development to citizens of California. What must Alex do to promote and sell his Nevada development in California?

According to the Interstate Sales Full-Disclosure Act, Alex must obtain a public report from HUD and deliver a copy of this report to each prospective buyer.

QUIZ: 6 of 10 Which of the following is not considered a type of common interest ownership? Community Apartment Project Condominiums, or Stock Cooperatives:

Answer: None of the Above

QUIZ: 2 of 10 Serena is studying for her California real estate license. She is very confused about base lines, meridians, townships, and ranges. Keeping these sets of intersecting lines straight has Serena stumped. Can you help?

Base lines are horizontal and run east/ west; meridians are vertical and run north/south; township lines are horizontal running east/west from a principal base line; and ranges are vertical running north/south on either side of a principal meridian.

QUIZ: 4 of 10 Jerry is interested in purchasing a lot for new construction in a new subdivision. The Commissioner has issued a preliminary public report in this case, allowing the subdivider to take reservations for lot purchases. Does Jerry have any recourse to change his mind?

Jerry may change his mind on the lot he has reserved. He is not committed simply because of the reservation. He may legally back out and receive a full refund, up until the time the final report is issued.

QUIZ: 3 of 10 Lot 19, Block 8, Western Acres Subdivision, City of Sacramento, County of Sacramento, State of California. Which method of legal description applies?

Lot and Block System

QUIZ: 1 of 10 Merle has a rural piece of land in the northern part of the state. He is in the process of selling it to a developer. The property has a pair of one-hundred-year-old trees that mark the entrance to the property. A stream and a bluff mark the end of Merle's property. What method of real estate description would best suit Merle's land?

Metes and Bounds System

10 of 10 Roy Malone owns a large piece of land in the Sonoma Valley. He is planning to subdivide the land into five lots for the construction of luxury homes. If Roy carries through with this project, what are his roles and his next steps?

Roy is considered a Subdivider. His first step should be a development plan; however, this plan must include all state and local government regulations, the Subdivided Lands Law, the Subdivision Map Act, the California Environmental Quality Act, zoning, and local general and specific plans.

A legal description is NOT:

THE ADDRESS of the property.

QUIZ: 5 of 10 Which of the following statements concerning California's three sets of base lines and meridians is true?

The Humboldt Base Line and Meridian in the northwestern part of the State; The Mt. Diablo Base Line and Meridian in the central part of the State; and The San Bernardino Base Line and Meridian in the southern part of the State.

QUIZ: 9 of 10 The Subdivision Map Act, the Subdivided Lands Law, and Land Projects all have a minimum number of lots required to meet requirements. Which of the following is correct?

The Subdivision Map Act regulates the division of two or more lots; The Subdivided Lands Law defines a subdivision as a division of land into five or more lots; and a Land Project must have fifty or more vacant lots.

Lot and Block system

This legal description lists the lot, block, subdivision, county, city, and state.

A Township is

a 36-square-mile area formed by the intersection of a township and range lines. Each township square is divided into 36 Sections, each one mile square

A Stock Cooperative is

a CORPORATION formed to own the land and improved real property, that either owns OR leases real property.

A land project is

a speculative subdivision development of 50 or more vacant lots that are located in a rural area that has fewer than 1,500 registered voters within 2 miles. Any contract to buy or lease land in a land project may be rescinded, IN WRITING, and without cause, within 14 days after the signing of the initial contract.

A planned development is

a subdivision in which the lots are owned separately, but certain areas are owned in common by all owners.

A developer is one who

attempts to put land to its most profitable use through the construction of improvements.

A Common Interest Development (CID):

common areas used by all tenants, with the exception of separate interests to use as individual living units, and managed by a nonprofit association. Types of common interest ownership: 1. Planned development (PD); 2. Community apartment project; 3. Condominiums (and time sharing); 4. Stock cooperatives (also known as "Co-ops").

A Condominium buyer

gets a FEE interest or DEED to his unit.

The Rectangular Survey System

government survey system

The Metes and Bounds system is sometimes used to describe

irregular pieces of property or in areas where a lot and block system is not in place.

A subdivider is an owner whose

land is divided into two or more lots and offered for disposition.

Range Lines are

lines on either side of a principal meridian and are divided into six-mile-wide strips by lines that run north and south parallel to the meridian.

The Interstate Sales Full-Disclosure Act

regulates land sales between two or more states. Under this law, out-of-state buyers have 7 days after receiving the public report to rescind the contract.

Police power is:

the constitutional right of the government to regulate private activity to promote the general safety, health, and welfare of society. No private property is exempt from eminent domain.

A Common Area is

the part of the lot or Chapter in the subdivision that is shared equally by all owners (undivided interest).

An undivided interest is

the right of any owner to use ANY part of the project.

Community Apartment Projects are

two or more apartments that are defined as a subdivision, in which the operation is usually exercised by the governing board.