In most cases, other parties will have certain limited use rights on any property that you purchase. For example, nearly every lot in residential subdivisions will have easements for utilities and may have drainage easements as well. An easement provides parties other than the property owner rights to use the property (usually a precisely specified portion of the property) for specific purposes. Utility easements give the city and other utility providers the right to use portions of each lot, often the 8-10 feet along the front and back lot lines, to run water, sewer, electric, gas, and cable lines through the property. These easements also allow utility providers access to the property for repair and replacement of their equipment, including rights to remove landscaping or improvements that interfere with their access to the easement. Drainage easements prohibit the homeowner from installing landscaping or building structures that interfere with ground water drainage through the subdivision.In rural and mountain areas, road easements, which allow adjoining property owners the right to build, maintain, and travel across your property, are very common.
There are few limits to the use rights that can be granted through easements. Several years ago, a client of ours granted the owner of the property he purchased the right to bury his late wife’s ashes in an aspen grove on his property. This easement included rights for the husband and the children to visit the site. Most easements are recorded, so you should learn about them by reviewing the “schedule of exceptions” in your title commitment (see the discussion of title insurance in our section Under Contract).
However, since easements do not have to be recorded to be legally binding, there is a clause (Section 8.2) in the standard Colorado purchase contract that requires the seller to notify the buyer of unrecorded rights that might affect title.
Two other use rights that are a common part of our real estate practice involve leases and mineral rights. As a home buyer, it is important to understand that you take ownership of any property subject to existing leases on the property. If you buy a home or condo that the owner has leased to another party, you are now a landlord under the terms of the existing lease. The standard contract requires (Section 8.2) that the seller disclose any existing leases to you. Also, because mining was such an important part of our history in this area, the mineral rights for much of the property in the area are owned by parties other than the person who owns the land or the home on the land. This is a particularly troubling issue for owners of rural and mountain properties with larger lots. Here, the ownership of mineral rights may give mining or oil/gas companies the right to enter onto the property, and to build access roads and other facilities, in order to exploit minerals on the property. Again, mineral rights that have been “severed” from the property should be listed in the “schedule of exceptions” in the title commitment (see the discussion of title insurance in our section Under Contract). If someone else owns the mineral rights on your property, you need to consult an expert to determine whether this has any real implications for you as owner of the property.