A broker colleague of mine called me up the other day in a panic. “We have this 46-acre property under contract at $1.5 million,” she said breathlessly, “and the buyers just got it surveyed. It turns out that the property is six acres smaller than we thought! What do we do?” I had to suppress a chuckle. I wasn’t laughing at her problem. I was just chuckling because it’s such a simple issue that never had to happen in the first place. If the seller had gotten a survey prior to listing the property, he wouldn’t be at risk of losing a big sale.
The survey proves what the seller owns
Anyone who invests in real estate should know what they own. That’s a pretty basic concept, isn’t it? Whether you own a ¼-acre building lot or a 10,000-acre ranch, it’s only natural to have a precise definition of your holdings. The only real way to establish those boundaries and the owner’s rights within those boundaries is through a survey. As land brokers, we encourage our buyers and sellers to obtain a survey to define exactly what’s happening with a property.
What is a survey and how does it proves real estate ownership? Metes and Bounds descriptions
A survey is a written mathematical description of the boundaries of a property. The original method of describing properties is called “metes and bounds”, which originated far, far back in recorded history. Such a description might make a “call” to follow a certain line, such as “Proceed north 400 paces to the large rock next to the river, thence 300 paces in a southeasterly direction along the east boundary of the river;” etc., until the point of beginning is reached. Metes and bounds legal descriptions can be very, very complicated. They are calculated by using azimuth bearings of a compass. Instead of using the sailor’s description of “south by southeast”, where every 90 degrees is a compass direction, the azimuth system uses all 360 degrees of the compass. Curves in a survey are described using terms such as “chords”, and distances are calculated by feet and inches, and directions by degrees, minutes, and seconds.
The Public Land Survey System (PLSS) and how it works
In 1807, when our brilliant forefather Thomas Jefferson sent Lewis and Clark out to explore the newly acquired Louisiana Purchase, he ordered them to survey the new territory using a new method—the Public Land Survey System. Instead of describing land using metes and bounds descriptions, he devised an entirely new method of describing these new lands. First he established baselines and meridians according to commonly known latitudes and longitudes of the globe. These were long straight lines often several hundred miles long that were used to provide a measuring point for large squares of land called “townships”. Each township is 6 miles x 6 miles, or 36 square miles. Each square mile is a section, or 640 acres. Each section can be mathematically divided into smaller tracts that can be easily described by directions of the compass. Consequently, a survey using the PLSS references the meridian that gives it bearing; then the township; then the section; and then which parcel inside of which quadrant of the section. If you divide a section into four equal quarters, each 160-acre parcel will have a name—the Northeast Quarter, the Southeast Quarter, the Southwest Quarter, and the Northwest Quarter. Each of these quarter sections can be further subdivided into 80-acre, 40-acre, 20-acre, 10-acre, and even 5-acre parcels using the same methodology. Surveyors often use initials to denote these directions. For example, “the SW1/4 of the NW1/4 of the W1/2 of Section 17, Township 13N, Range 85W of the New Mexico Principal Meridian”.
An ingenious system of describing real estate—farmers understand the PLSS
We often use common surveying terms to describe everyday situations, such as “he’s out on the back 40”, or “he bought a quarter section to raise corn”, or similar terms. When you fly over farm country and you see all those neatly divided squares of land below you, that’s a true visual image of the PLSS. Jefferson even went so far as to build in “correction sections” into the grid, whereby the squares are angled slightly to anticipate the curvature of the earth.
This brings us to a common survey, which can use elements of the PLSS and metes and bounds to describe a property. Here’s an example:
“LEGAL DESCRIPTION
A parcel of land located within the SE1/4 of the NE1/4 of Section 25, Township 14 South, Range 93 West of the 6th Principal Meridian, having a description based upon a bearing of S.00°10’58″W. from the section corner common to Sections 19, 24, 25 and 30 (monumented by a 3 1/4″ aluminum cap PLS 12766) to the 1/4 corner common to Sections 25 and 30 (monumented by a Gear Top Spike in asphalt) with all other bearings relative thereto and being more particularly described as follows:
Beginning at the NE corner of said SE1/4 of the NE1/4, also being the N1/16 corner common to Sections 25 and 30 (monumented by a 3 1/4″ aluminum cap PLS 25972) thence along the section line common to Sections 25 and 30 S.00°10’58″W. 887.46 feet (monumented by a 1 1/2″ aluminum cap RLS 1456); thence leaving said section line S.86°01’37″W. 431.38 feet (monumented by a 1 1/2″ aluminum cap RLS 1456); thence S.86°02’50″W. 187.61 feet (monumented by a 1 1/2″ aluminum cap PLS 12766); thence N.01°29’35″E. 73.71 feet (monumented by a 2″ aluminum cap PLS 25972); thence S.89°50’24″W. 234.98 feet (monumented by a 1 1/2″ aluminum cap PLS 12766); thence N.02°20’44″W. 9.76 feet (monumented by a 1 1/2″ aluminum cap PLS 12766); thence N.00°02’58″W. 136.26 feet (monumented by a 2″ aluminum cap PLS 12766); thence N.00°06’34″W. 137.01 feet (monumented by a 2″ aluminum cap PLS 12766); thence N.00°16’39″E. 634.20 feet to the north line of said SE1/4 of the NE1/4 (monumented by a 2″ aluminum cap PLS 25972); thence along said north line S.85°58’14″E. 853.22 feet to the Point of Beginning, said parcel contains 18.078 acres, more or less.
Town of Hotchkiss,
County of Delta,
State of Colorado.”
Do you have any earthly idea what that means? Most people don’t. All they can tell is that the parcel is a little bigger than 18 acres, it’s in Hotchkiss, Colorado, and it’s in Delta County, Colorado.
A legal description must “close”—otherwise it goes out to infinity
Real estate experts, however, know what a legal description says, and those who are very accomplished can read and chart this legal description to make sure it “closes”. You can make whatever shape you want, but you can’t leave an opening in the shape, or the legal description theoretically includes infinity. Practically speaking, however, we see troublesome surveys that don’t close fairly often. That means someone has to fix it or someone has to compromise in order to obtain a satisfactory survey. “Fixing it” might mean a new survey, a lot line adjustment with the neighbor, or agreeing to use an existing fenceline or monument to correct the issue, even though it’s fundamentally incorrect.
Where a survey can make all the difference—in buying and selling real estate
As we drive around in cars with mobile phones giving us directions, we’re navigating using satellite imagery that can be very, very precise. That technology was simply non-existent even a couple of decades ago, and it wasn’t that long ago that surveyors were using lengths of chain to measure distances. If a property hasn’t recently changed hands, chances are good that the survey is inaccurate. I can give quite a few examples of incorrect surveys, but I’ll limit it to three:
- Elderly seller had bought a rectangular 10-acre parcel in the 1970’s and obtained a rudimentary survey—pen and ink drawing—showing his parcel. He never bothered to locate the corner pins. When selling the property, my new buyer requested and paid for a new survey. It turns out that the southeast corner of the property was off by 56 feet, and the neighbor was using that extra acre or so of property to store a bunch of junk vehicles, abandoned camper shells, and various trash. Since it had been more than 18 years, the neighbor claimed adverse possession, and there was nothing the buyer could do about it. The property is in actuality 9 acres, with the neighbor taking hostile possession of the other acre and using it as a junkyard.
- Seller was ADAMANT that the US government had completely surveyed her 216-acre property in the past and had recorded the survey with the county. Again, our buyers requested a new survey because they wanted to know what they were buying! It turns out the seller didn’t know what she was talking about, despite her vociferous protestations to the contrary. The Bureau of Land Management had indeed surveyed the property, but it was back in 1956, and they had surveyed only one property line. Using the “call” provided by the government for the southern boundary, the legal description didn’t close, the survey had to be corrected, and she ended up losing two acres of valuable creek frontage. It took a month and a half to sort it all out. In the meanwhile, the buyers, who were ready and able to close, got cold feet and backed out of the deal. The property never sold.
- There were actually two surveys on the same 40-acre property that had been done within three months of one another, but they were in great conflict with one another. One survey had the northwest corner of the property all the way across the county road on a little hill, requiring the surveyor to go back and re-survey almost the entire section of land to get everything corrected.
Easements, encroachments, adverse possession, and matters in dispute—look at the title commitment
Not only does a survey show what the property encompasses, it also shows what rights others may have to the property—or violations of the property owner’s rights. When asked to begin a new survey, the first thing a surveyor does is request a title commitment. Anytime a landowner grants a right to others to use the property in one way or another, the only way to preserve that right is to record the document with the county clerk, using the property’s legal description to bind it to the property. Any correct title commitment will show all those title exceptions, as they’re called. A true survey doesn’t just note the boundaries of the property; it also shows easements across it such as roads, power lines, ditches, gas lines, and other encroachments. It should show fences, monuments, corner pins, driveways, and other notable features.
There are many different types of surveys, varying in complexity and scope
A basic boundary survey will show the boundaries of the property and easements across it. However, surveys can be much more complex than that, including improvement surveys and ALTA surveys. An improvement survey not only notes the boundaries, but also locates the exact position of all the buildings and improvements on the property. For example, it may note the main house, the barn, the milking parlor, the headgate for the irrigation ditch, a cell phone tower, gas main, pumping station—the list of improvements can be almost endless. An ALTA survey is a very complex survey that takes a high degree of proficiency to accomplish. Of course, as the degree of complexity increases, so does the cost.
What is an Improvement Location Certificate, or ILC?
An improvement location certificate is basically a quick-and-dirty survey that shows the property boundaries and where the improvements are located on the property. Many lenders request ILC’s so that they can verify that there is indeed a home located on a particular piece of land. ILC’s do not show easements, boundary disputes, encroachments, or other important issues that a survey will show. For example, I recently received a call from an attorney whose client had purchased a home on a 2-acre parcel. The homeowner had gotten an ILC when he purchased the property, but it didn’t show that the neighbor had a 30-foot access easement across the back side of the property where the neighbor had every right to build a road—and he did. It seriously impacted the homeowner’s privacy and property values. The ILC didn’t show it, but a survey would have.
The combination of the title commitment and the survey proves ownership, easements, and encroachments
As noted above, the surveyor requests a title commitment before going to work on a survey, because it tells him what he needs to look out for and note on the survey. A good title commitment is an important tool to determine exactly what the property has and doesn’t have. A good broker knows how to read both the title commitment and the survey to advise a client on the particular attributes of a property. For example, what does it mean when a ditch easement crosses a property? It means that the ditch company or the owner of the water can come in any time they please with a backhoe and clean the ditch, dumping muddy debris on your land, and you don’t have a thing to say about it. If you plant trees in the way, they have every right to run over them, dig them out, or destroy them in any way they see fit.
A property isn’t clearly defined without a survey
In my professional opinion, it is the property owner’s responsibility to provide a survey to a new buyer. It’s the owner’s proof of what they have. In rare cases, I might approve of a buyer making a purchase without a survey, but I generally don’t recommend it. In some cases, a seller will dig in and refuse to fund the cost of a survey, and the buyer ends up paying for it. I still counsel the buyer to get one, and indeed, the buyer may back out of the deal after paying for a survey. In the event of a lot-and-block subdivision parcel, I’m not too worried about having a survey, because lots should be clearly identified through the subdivision plat. If a seller is truly ready to sell, having a completed survey in hand really helps a sale go through quickly. It gives the buyer immediate information as to what the property entails, and helps the buyer make planning decisions. If there is no survey and one is required for the purchase to be completed, it can often take up to 45 days for a survey to be made, which is a long time and can complicate the chances of a deal coming to the closing table.
The bottom line—a survey is recommended, and get it done before you have to get it done
The bottom line is a survey can make or break a deal, so pay up and get it done and have it in hand well before it’s an emergency situation and you have to scramble. If you are a buyer and you make a land purchase without a survey, don’t be surprised if something jumps up and bites you in the ass. And once you have a survey in hand, go over it carefully with a competent broker or the surveyors themselves to make sure you understand what it reveals to you.
