Community Property
Definition
Community property is a form of ownership recognized in certain states where property acquired during marriage is considered equally owned by both spouses, regardless of who earned the money or whose name is on the title.
Example
A couple lives in California (a community property state). The husband buys a rental property during the marriage using his salary. Even though only his name is on the deed, the property is community property and the wife owns a 50% interest. However, a house the wife inherited from her parents remains her separate property.
Exam Tip
Know the community property states (memorize: AZ, CA, ID, LA, NV, NM, TX, WA, WI). Property acquired DURING marriage with marital funds = community property. Property owned BEFORE marriage, inherited, or gifted = separate property. Each spouse can will their 50% share—there is no right of survivorship.
Related Ownership Terms
Bundle of Rights
The bundle of rights describes the rights associated with property ownership, allowing owners to use, control, enjoy, exclude others from, and dispose of the property.
Freehold Estate
A freehold estate represents ownership of real property with an indefinite duration.
Leasehold Estate
A leasehold estate grants the right to possess and use property for a defined period of time, without conferring ownership.
Life Estate
A life estate is a freehold estate that grants ownership rights for the duration of someone's life.
Water Rights: Riparian and Littoral
Riparian rights concern properties bordering flowing bodies of water (rivers, streams), while littoral rights concern properties bordering non-flowing bodies of water (lakes, oceans).
Real Property vs. Personal Property
Real property is immovable land and anything permanently attached to it, while personal property (also called chattels) is movable.
Frequently Asked Questions
Test Your Ownership Knowledge
Practice with exam-style questions to make sure you can apply Community Property and other ownership concepts.