What does "fee simple" refer to in property ownership terms?

"Fee simple" is a term used in property law that refers specifically to the highest form of land ownership available. It signifies that the owner has full legal rights to the property, which includes the ability to use, sell, lease, or develop the land at their discretion, without any restrictions. Importantly, fee simple ownership also allows the property to be passed down to heirs, making it inheritable with no qualifications. This means that when a fee simple property is transferred upon the owner’s death, it typically does so without any complications or conditions, underlining the notion of complete ownership.

Inevitably, this distinction sets fee simple ownership apart from other forms of tenure or property rights where restrictions might apply, such as leases, limited ownership rights, or other encumbrances. For example, a lease agreement does not confer ownership, but merely allows the lessee to use the property for a specified time. Similarly, land that cannot be inherited would not qualify as fee simple, as one of its key characteristics is the ability to be passed down. Lastly, land under a commercial lease represents a temporary right to use the property without ownership, further distinguishing it from the full rights associated with fee simple ownership.