Property OwnershipIntermediateCalifornia Exam

A fixture is determined by which of the following tests?

AIts purchase price, as typically recorded in a California deed

BMethod of attachment, adaptability, intention of the parties, and agreementCorrect

CWhether it was installed by the owner or a contractor, consistent with common law property ownership principles

DIts age, per standard California real property conventions

Why Method of attachment, adaptability, intention of the parties, and agreement Is Correct

Answer B: Method of attachment, adaptability, intention of the parties, and agreement

Courts use several tests to determine if an item is a fixture: method of attachment (how permanently), adaptability (designed for that property), intention of the parties, and any written agreement.

Exam Tip: Property Ownership

Property ownership questions test the bundle of rights and different forms of ownership. Know the differences between joint tenancy, tenancy in common, and community property, including the right of survivorship.

Key Property Ownership Terms in This Question

Deed

A written legal instrument used to transfer ownership of real property from one party (grantor) to another (grantee).

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Key Terms to Know

Listing Agreement

A contract between a property owner and a real estate broker that authorizes the broker to market and sell the property.

Purchase Agreement

A legally binding contract between a buyer and seller that outlines the terms and conditions of a real estate sale.

Option Contract

A contract giving the buyer the right, but not the obligation, to purchase a property at a specified price within a specified time period.

Loan-to-Value Ratio (LTV)

The ratio of a mortgage loan amount to the appraised value or purchase price of a property, expressed as a percentage.

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