In your real estate journey, you’ll bump into a few terms that might sound a bit complicated at first, like easement. And you might be wondering, what is an easement in real estate?
An easement means someone else has the legal right to use a part of your property for a specific reason, even though you still own it. These rights are often granted to neighbors, utility companies, or government entities for different purposes. For example, your neighbor might have the right to use a small path on your land to access their home. Or a power company may run cables or pipelines through your yard to serve the community. They don’t own your land, but they’re allowed to use that part of it.
Now let’s look at it more broadly — why easements matter, the different types that exist, how they’re created, and what you should know as a property owner or buyer.
Main Takeaways
What is an easement in real estate:
- Easements give others legal rights to use part of your property—typically for utilities, access, or shared pathways—without transferring ownership.
- They can affect what and where you can build, influence privacy, and impact rental income or resale value, especially if they restrict property use.
- Before buying or developing property, always review easements in title records and consult a real estate attorney to avoid costly surprises.
What is an Easement in Real Estate and Why Does it Matter?
Easements might sound like just more real estate jargon, but they can have a real impact on your property, whether you’re buying, selling, or renting it out. That’s why many landlords turn to Philadelphia property management companies for guidance on handling these matters.
To answer, “what is an easement in real estate,” let’s start with this one point. For starters, an easement can affect how you use your property. Let’s say a utility company has the right to access part of your land to repair power lines. You might not be allowed to build anything permanent in that area, like a garage or a fence, because they need access whenever maintenance is required.
For landlords, easements can affect what kind of improvements you can make or where you can build. It’s important to know where any easements are located before you develop or rent out the property.
At the end of the day, being aware of existing easements helps you avoid surprises.
Common Types of Easements in Real Estate
Not all easements are the same. They come in different forms, depending on who’s using the property and for what reason. Here are some of the most common types you might come across:
- Utility Easement
Utility companies — like electricity, water, gas, or internet providers — may have the right to install and maintain their equipment on part of your property. That could mean underground pipes, power lines, or even poles in your yard. You still own the land, but the utility company can access it when necessary to repair or service their equipment. - Right-of-Way Easement
This allows someone to pass through your property to reach another location. For example, if your neighbor’s house sits behind yours and they need to drive across your driveway to get home, that’s a right-of-way easement. These are common in rural areas or shared private roads. - Private Easement Agreements
Sometimes, two private property owners enter into an agreement for a specific use. For instance, one neighbor might give another permission to use part of their yard as a garden pathway. These agreements should always be put in writing to avoid future conflicts. - Prescriptive Easement
This one happens when someone has been using part of your property for a long time without permission and eventually gains legal rights to continue using it. The rules for this vary depending on local laws and how long the use has been going on.
Examples of Easements You Might Encounter as a Landlord or Investor
If you’re buying or managing property, it’s good to see how easements play out in everyday situations. Here are a few real-life examples landlords and investors often face:
- Shared Driveways
Even though you own the property, the neighbor has a legal right to use part of that driveway to access their garage. As a landlord, you’ll need to make sure your tenants understand that they can’t block or interfere with that access. - Utility Access
You might own a multi-unit building where the power company needs to access a section of the yard to maintain underground cables. They may occasionally enter the property for repairs. You can’t deny them access because their easement gives them that right. - Water or Drainage Easements
Some properties have easements that allow water companies or local governments to maintain stormwater drains or sewer lines that run under part of your land. This means you might be limited on what you can build or plant in those areas. - Pathway Easements in Apartment Complexes
If you own an apartment building, there might be walkways or alleys on your property that other people are allowed to use, like neighbors getting to their homes or emergency crews needing quick access. That’s why you want to know exactly where these easements are before you start doing any major work, like adding new landscaping or making renovations. - Landlocked Property Access
Sometimes, an investor might buy a piece of land that has no direct road access. An easement may allow access through a neighboring property to reach the public road. Without that easement, the land could be nearly impossible to use or sell.
How Easements Are Created in Real Estate
Now that we’ve covered what an easement is, along with the types and real-life examples, let’s look at how easements are actually created. Depending on the situation, there are a few different ways easements can come about:
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Written Agreement:
Most easements are made through formal agreements between property owners. These are usually written, recorded in public records, and included in property documents.
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By Law (Easement by Necessity or Government Action):
Sometimes, easements are created automatically by law. For example, if a property has no direct access to a public road (landlocked), the court can grant an easement to allow the owner to reach their land — that’s called an easement by necessity. In other cases, the government may create easements for public needs, like installing utility lines, building drainage systems, or expanding roads. Even though you own the land, the law gives others the legal right to access certain parts of it when necessary.
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Long-Term Use (Prescriptive Easement):
If someone has been using part of your property for a long time — like cutting through your land or parking there — and you never stopped them, they might eventually gain legal rights to keep using it. This depends on local laws and the duration of the issue.
Do Easements Decrease Property Value?
It depends. Easements don’t always lower a property’s value, but they can influence how buyers or investors view the property.
A small utility easement tucked in one corner usually won’t bother most buyers. But if an easement limits building options, reduces privacy, or allows regular access to your property, some buyers may see it as a drawback. For landlords, easements that affect outdoor space, cause maintenance disruptions, or limit upgrades can also impact tenant satisfaction and rental income.
On the other hand, some easements can actually add value to your property, like shared access that connects a landlocked property to a public road.
How Easements Impact Rental Properties
Easements can affect how you manage and use a rental property. Some easements may limit where you can build, install fences, or make improvements. Utility companies or government agencies may need occasional access for maintenance, which could temporarily inconvenience tenants.
In most cases, small easements don’t cause major issues. However, if an easement affects parking, outdoor space, or privacy, it may impact tenant satisfaction and your ability to attract or retain renters. Not factoring them into your business is one of the most common mistakes landlords make.
What Investors Should Know Before Buying a Property with an Easement
Before buying any property, it’s important to review all existing easements. Some easements are minor and won’t significantly impact your investment. Others could limit what you can build, reduce privacy, or create long-term obligations you’ll have to honor.
Always check property records, survey reports, and title documents to see where easements are located and what rights others have. And at the end of the day, we recommend you always consult a real estate attorney who understands local regulations.
Get Professional Help Managing Easements and Your Property
To answer, “what is an easement in real estate,” an easement gives someone else the legal right to use a portion of your property—like for utility access or shared driveways—without owning it. While some easements have little impact, others can limit how you use, build on, or profit from the land. So, it’s essential to review them carefully before you buy or lease out a property.
Easements can be challenging to navigate, especially when buying or managing property. You need expert guidance to review, manage, and protect your investment. At Bay Property Management, we understand how easements work and their impact on your property. Let us help you handle easements — and property management in general — with confidence. Contact us today.
