Property ownership is relatively straightforward. You purchase a building, usually with a loan and some funds of your own, and then the property is described as yours. Technically, it belongs to the bank until you have finished paying for it.
Once you own the property, it is difficult for anyone to take it from you. However, there are rare circumstances where it is possible.
In most scenarios, this won’t happen. But, if you’re interested in property investment, you should be aware of how adverse possession works. It may influence your decision to invest. At the least, it should encourage you to chat with the specialists in where to buy an investment property.
Adverse Possession
It takes a long time to benefit from adverse possession rights. In essence, the property of another person can become yours if you use the property as your own for a minimum period of 15 years. During this period, you must not compensate the owner in any way.
A great example of this is an abandoned house where squatters have moved in. If the squatters manage to stay in the house for fifteen years without paying rent, then the house can legally become theirs.
Of course, it will be necessary to prove that they have been there for 15 years and never provided a benefit to the owner. If this is the case, then the squatters will gain all the rights of ownership, leaving the original owner with nothing.
It should be noted there are three standards that must be met for this approach to work:
Time Limit
As mentioned, to claim adverse possession, you must have been utilizing it for at least 15 years. If you are trying to eliminate a road or easement through the property, then you must be able to show it hasn’t been used in thirty years or more.
Possession
To qualify for adverse possession, you must be living on the property. However, you cannot have the owner’s consent. You must occupy the property openly and peacefully. It’s essential that this is for the whole 15 years. Any period when you are not living at the property resets the slate, meaning you have to start the 15 years again.
Intention To Claim Adverse Possession
To qualify for adverse possession, you need to demonstrate that you intended to do this from the start. The simplest way of doing this is to fence the property in, pay the rates, and undertake maintenance and repairs.
Remember, the true owner can, in no way, consent to you living in and using their property.
Why It’s Relevant To Property Investors
If you’re planning on purchasing a property, then the first thing you need to do is verify that the property you have chosen belongs to the person selling it. If this isn’t the case, you will simply be giving money away. This is true even if the original owner believes they are the owner of the property but have lost the property due to adverse possession rights.
Make sure you check before you invest.
