PSI Oklahoma Real Estate Practice Test

What does encroachment refer to in real estate?

1. Ownership of property by adverse possession

2. A structure built on another person's property

3. An illegal transfer of property rights

4. A type of property defect disclosure

The correct answer is: A structure built on another person's property

Encroachment in real estate specifically refers to a situation where a structure, such as a fence, building, or any improvement, is built on or over the property line of another person’s property. This can happen unintentionally, such as when a property owner is not aware of the precise boundary lines, or intentionally, although the latter would typically lead to legal disputes. The presence of an encroachment can create potential legal challenges, as the property owner whose land is encroached upon may seek to have the encroachment removed or may claim damages. Recognizing encroachments is important during property transactions, surveys, and when considering property improvements, as it can affect property value and ownership rights. The other options reference different concepts in real estate. Adverse possession relates to obtaining ownership rights through continuous and open use of someone else's land, which is distinct from encroachment itself. An illegal transfer of property rights pertains to wrongful conveyances of ownership without proper authority, which does not directly describe the physical overlap of properties indicated by encroachment. Lastly, property defect disclosure involves informing potential buyers about known issues or defects affecting a property, not specifically the issue of boundary infringement that encroachment addresses.