Real Estate Law Types – Main Differences
Look around you. Whether you are standing in the middle of a house, an apartment building, a supermarket or an open space of land, the regulations that govern real estate law impacts you. In the United States, this branch of law is the one that oversees the buying, selling and transfer of all so-called “real” property.
With that said, not all real estate laws are concerned with the same kinds of real estate. In general, there are two branches. For small businesses and corporations, there are commercial property laws. Houses and apartment buildings, on the other hand, fall under residential law. While there is overlap between both legal realms, there are also some key differences. Here are the top four:
- Extent of Disclosure Requirements
While the law expects sellers of both residential and commercial properties to disclose defects that may reduce their value, there are usually fewer limitations placed on commercial disclosures. Residential property owners must share information about both visible and invisible problems, whereas the law does not require the same for commercial sales. Local and state laws may apply, but federal requirements only involve disclosing lead, asbestos and other environmental hazards.
- Complexity of Foreclosure
In general, the foreclosure laws of commercial and residential real estate are somewhat similar, but the process for business properties is usually more complex. With commercial foreclosures, loan terms can determine whether additional legal processes are necessary.
- Implementation of Zoning Regulations
One of the biggest differences between residential and commercial property laws has to do with zoning. When you buy a piece of land, you cannot simply use it for whatever you want. For example, just because you purchase a home in the middle of the city does not mean you can start operating a steakhouse out of it. For this reason, you should always check your local zoning regulations before engaging in any sort of business activities. Likewise, the same is true if you want to turn your pizza shop into an apartment building. For land, there are also agricultural zoning laws to consider.
- Regulation of Tenant-Landlord Agreements
Another major difference between the types of real estate law involves the kind of protections available or unavailable for tenants. With a residential property, for example, the law provides numerous protections for tenants. From rent amounts to rent increase limits to termination allowances, these kinds of legal safeguards generally do not exist for tenants in commercial property agreements.
When it comes to buying and selling residential and commercial property, there are numerous, nuanced state and local laws to consider. To get a better understanding of how specific legalities apply to your situation, consider speaking with an experienced residential real estate lawyer, like those at McCarthy Law, LLC. Too often, people only seek legal guidance when they’re in trouble. In truth, lawyers are great assets who should be consulted any time you find yourself in need of experienced legal counsel. As most attorneys provide an initial consultation session for free, you have virtually nothing to lose and potentially a great deal to gain by seeking out a lawyer’s help.