What Is Adverse Possession?
Adverse possession is a legal concept wherein property ownership transfers from one person to another based on continuous occupancy. While it's colloquially referred to as squatters' rights, it doesn't condone illegal occupation of property. Typically, adverse possession disputes arise between neighbors, such as when a fence encroaches onto a neighbor's land and is used for an extended period. This issue often arises during property sales when a land survey reveals the encroachment, prompting a legal process to determine ownership rights.
The Legal Framework of Adverse Possession
Adverse possession is governed by specific legal requirements that vary by state but share common elements across the United States:
1.??? Actual and continuous use:
The individual seeking adverse possession must physically occupy the property for a defined period, with some states also requiring evidence of maintenance or payment of property taxes during this time.
2.??? Exclusive use:
The claimant must have sole control and use of the property, without sharing it with the original owner or anyone else.
3.??? Hostile:
This term doesn't imply hostility but rather signifies that the occupation is without the explicit permission of the property owner.
4.??? Open and notorious:
The use of the property must be visible and obvious to anyone, indicating the occupant's assumption of ownership.
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The primary requirement for adverse possession is actual and continuous use of the property, which varies in duration across states, ranging from five to twenty years. Additionally, many states necessitate supporting evidence, such as tax bills, to substantiate possession claims.
Elements of Adverse Possession
The elements of adverse possession each play a role in who is legally awarded the property.
A hostile claim
In adverse possession occurs when someone asserts ownership of a property without permission. For instance, if a neighbor plants and tends a garden on a portion of your land, assuming it's theirs, and continues to do so for a decade, it constitutes a hostile (though nonviolent) claim.
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Actual possession
Requires tangible evidence of using the property. For example, erecting a fence on a neighbor's land without subsequent maintenance or use of the area doesn't meet the criteria. There must be clear proof of consistent usage, potentially including tax documents or evidence of labor to maintain the property.
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Open and notorious possession
?Mandates that the trespasser's use of the property cannot be concealed. It must be overt and evident, even to strangers, regardless of the actual owner's awareness or acknowledgment of the situation.
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Exclusive and continuous possession
Necessitates uninterrupted use of the property throughout the statutory period set by the state. Vacating the property or sharing its use with the original owner undermines the claim of adverse possession.
Preventing Adverse Possession
Consider the following tips to prevent an adverse possession claim on your property:
Establish clear boundaries by marking the land with fencing or no trespassing signs, especially if you don't reside there. Regularly visit the property to prevent unauthorized use, as allowing prolonged occupancy by others may lead to adverse possession.
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When permitting property use, document agreements in writing, particularly for non-residential land. A written agreement can invalidate adverse possession claims.
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Promptly address any trespassing issues to prevent adverse possession. Regular property inspections and swift action against trespassers can mitigate the risk.
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Before purchasing investment properties, conduct surveys to verify property boundaries and identify any existing unauthorized occupants, reducing the likelihood of adverse possession claims arising.
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Adverse Possession and Real Estate Investing
Investors should be well-versed in adverse possession to prevent unauthorized use of their property and potential loss of ownership rights. While trespassing may be conspicuous in urban settings, it can be less apparent yet more detrimental in rural areas.
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If you're aware of any unauthorized use of your property, such as neighbors' livestock grazing on your land, consider creating a written agreement documenting your consent to prevent adverse possession claims resulting from neglect.
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In cases of trespassing, whether identified before or during property ownership, attempt to resolve the issue amicably with the neighbor. This could involve negotiating a change in legal title or initiating a "quiet title" lawsuit to determine property ownership through legal proceedings.
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While laws safeguard landowners against adverse possession, proactive measures and due diligence are essential to mitigate the risk effectively.
Final Thoughts
Adverse possession can negatively affect an investment property, especially if you don’t visit it often. Losing a part of your property can be detrimental to its value and use, especially when you try to sell it. Understanding what adverse possession is and how to avoid it is important to protect your investments.
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