3.2 Nevada Property Rights and Ownership
Key Takeaways
- Nevada is one of nine community property states; property acquired during marriage is presumed owned equally by both spouses.
- Separate property includes anything owned before marriage plus gifts and inheritances received during marriage.
- Joint tenancy requires the four unities of time, title, interest, and possession (TTIP) and carries a right of survivorship.
- Nevada's homestead exemption protects up to $605,000 of equity in a primary residence from most judgment creditors (NRS 115.010).
- Nevada follows prior appropriation for water rights: first in time, first in right, with beneficial use required.
Community Property in Nevada
Nevada is one of nine community property states. Property acquired by either spouse during marriage through work or earnings is presumed owned equally by both spouses, regardless of whose name is on the title or who earned the money.
Separate property is owned by one spouse alone and stays separate. The classic memory device for separate property is the three Gs plus "before": acquired Before marriage, by Gift, by inheritance (beQueath), or bought with separate funds.
| Community property | Separate property |
|---|---|
| Wages/salary earned during marriage | Owned before marriage |
| Real estate bought with marital funds | Received as a gift to one spouse |
| Business profits earned during marriage | Inherited by one spouse |
| Returns on community investments | Bought with traceable separate funds |
Signature trap (high-yield): When listing or selling community property, both spouses must sign the listing agreement and the deed, even if only one spouse's name appears on title. For separate property, only the owning spouse signs. A deed signed by only one spouse on community property is defective.
Forms of Co-Ownership
| Form | Shares | Survivorship | Transfer on death |
|---|---|---|---|
| Tenancy in common | Equal or unequal | None | Share passes by will/probate |
| Joint tenancy | Must be equal | Yes | Passes to surviving joint tenants |
| Community property | Equal (spouses) | None unless survivorship added | Decedent's half by will |
| CP with right of survivorship | Equal (spouses) | Yes | Passes to surviving spouse, avoids probate |
Tenancy in common is the default form when two or more unmarried people take title without specifying otherwise.
The four unities of joint tenancy (TTIP)
| Unity | Requirement |
|---|---|
| Time | All owners take title at the same moment |
| Title | All take by the same deed/instrument |
| Interest | All hold equal shares |
| Possession | All have the right to possess the whole |
If a joint tenant sells their interest, that breaks the unities and severs joint tenancy as to that share, which then becomes a tenancy in common with the remaining owners. Remember "TTIP" for the exam.
Community Property With Right of Survivorship
Nevada lets spouses hold title as community property with right of survivorship. On the first spouse's death the property passes automatically to the survivor, avoiding probate, and may preserve a full stepped-up basis for tax purposes (a community-property advantage over plain joint tenancy).
Deeds in Nevada
A deed transfers title. The type of deed determines how much the grantor (seller) promises about the title.
| Deed type | Protection to grantee |
|---|---|
| General warranty deed | Greatest; warrants against all defects, even before grantor owned it |
| Special warranty deed | Warrants only against defects arising during grantor's ownership |
| Bargain and sale deed | Implies grantor owns it but gives no warranties |
| Quitclaim deed | No warranties; transfers only whatever interest the grantor has (which could be none) |
A quitclaim deed is common for clearing clouds on title or transferring between spouses, but a buyer should rarely accept one in an arm's-length purchase.
Requirements for a valid deed
- In writing (Statute of Frauds)
- Competent grantor named and identified
- Grantee named and identifiable
- Adequate legal description
- Granting clause (words of conveyance)
- Grantor's signature (the grantee does not sign a deed)
- Delivery and acceptance during the grantor's lifetime
- Notarization is required to record (not to validate the transfer between the parties)
Recording
| Aspect | Detail |
|---|---|
| Where | County Recorder's office where the land sits |
| Effect | Gives constructive notice to the world |
| Priority | Generally first to record has priority (race-notice principles) |
| Not required for validity | A deed is valid between the parties even if unrecorded |
Homestead Exemption (NRS 115)
Nevada's homestead exemption protects up to $605,000 of equity in a primary residence from forced sale by most judgment creditors (credit cards, medical bills, personal loans).
| Feature | Detail |
|---|---|
| Amount protected | $605,000 of equity |
| Property covered | Primary residence, qualifying mobile home, or condo unit |
| Filing | A recorded Declaration of Homestead secures it; some protection is automatic |
| Does NOT protect against | The mortgage, property taxes, mechanic's liens, and HOA assessments |
Worked example: A home is worth $700,000 with a $200,000 mortgage, so equity is $500,000. Because $500,000 is below $605,000, a credit-card judgment creditor cannot force a sale. Vacation and rental homes do not qualify.
Water Rights
Nevada is a prior appropriation state, not a riparian state. The rule is "first in time, first in right": the earliest user with a valid permit has the senior right.
- Water must be put to a beneficial use or the right can be lost ("use it or lose it").
- A permit from the State Engineer is required.
- Water rights can be sold or transferred separately from the land, an important point in rural Nevada transactions.
A married couple in Nevada owns their home, but only the husband's name appears on the title because he bought it with marital earnings during the marriage. To sell, who must sign the deed?
A Nevada home is worth $700,000 with a $200,000 mortgage. A credit-card company obtains a judgment. How does the homestead exemption apply?
Which of the following is the four unities required to create a joint tenancy in Nevada?