Comprehensive Study Guide
---
Overview
Land use controls govern how private and public entities can use real property, balancing individual ownership rights with community welfare. These controls fall into two categories: public controls (zoning, building codes, eminent domain) imposed by government authority, and private controls (deed restrictions, HOA rules) enforced between private parties. Mastery of this topic is essential for the Texas Real Estate Salesperson Exam, as questions appear across multiple content areas.
---
Section 1: Zoning Fundamentals
What Is Zoning?
Zoning is the division of a municipality into districts with specified permitted land uses. It is enacted under the government's police power and represents one of the most commonly tested topics on the exam.
Core Zoning Concepts
• Zoning ordinance – Local law that divides land into districts (residential, commercial, industrial, agricultural) and specifies what uses are allowed in each
• Master plan (comprehensive plan) – The long-range policy document that zoning ordinances are designed to implement; zoning must be consistent with the master plan
• Zoning board of adjustment (appeals board) – The body that hears variance requests; distinct from the local legislature
Types of Zoning Actions
| Term | Definition |
|------|-----------|
| Variance | Official permission to deviate from zoning requirements due to unique hardship; granted by the board of adjustment |
| Conditional use permit (special use permit) | Allows a use not ordinarily permitted in a district, subject to specific conditions |
| Nonconforming use | A legal use that predates a new zoning ordinance; allowed to continue but cannot be expanded |
| Spot zoning | Rezoning a single parcel differently from surrounding properties; often legally challenged |
| Buffer zone | A transitional area between incompatible uses (e.g., industrial and residential) |
Key Terms
• Permitted use – Uses allowed by right in a zoning district
• Rezoning – Changing a property's zoning classification through the legislative process
• Nonconforming structure – A building that does not meet current zoning standards but predates them
Watch Out For
> ⚠️ Variance vs. Conditional Use Permit: A variance excuses compliance with a zoning requirement (e.g., setback distance). A conditional use permit allows a type of use not normally permitted. These are frequently confused on exams.
> ⚠️ Spot zoning is NOT the same as a variance. Spot zoning is rezoning by the legislature; a variance is granted by the board of adjustment.
> ⚠️ Nonconforming uses can continue but cannot be expanded — a critical distinction.
---
Section 2: Government Powers Affecting Real Estate
The Four Government Powers – PETE
| Letter | Power | Description |
|--------|-------|-------------|
| P | Police Power | Authority to regulate for public health, safety, morals, and welfare — no compensation paid |
| E | Eminent Domain | Power to take private property for public use — just compensation required |
| T | Taxation | Power to levy property taxes — failure to pay can result in tax lien or sale |
| E | Escheat | Property reverts to the state when owner dies without a will and without heirs |
Eminent Domain & Condemnation
• Eminent domain – The power or right to take private property for public use
• Condemnation – The legal process by which eminent domain is exercised
• Just compensation – Required by the Fifth Amendment; generally equals fair market value
• Inverse condemnation – When a government action (not a formal taking) substantially damages or reduces property value, and the owner sues for compensation
Police Power vs. Eminent Domain
| Factor | Police Power | Eminent Domain |
|--------|-------------|----------------|
| Compensation paid? | No | Yes (just compensation) |
| Examples | Zoning, building codes, environmental regs | Highway construction, public buildings |
| Basis | Public health, safety, welfare | Public use |
Escheat
• Triggered when a person dies intestate (without a will) and with no known heirs
• Property reverts to the state of Texas
• Distinguishable from inheritance — escheat only applies when no heirs exist
Key Terms
• PETE – Mnemonic for the four governmental powers
• Fifth Amendment – Constitutional basis for just compensation in eminent domain
• Intestate – Dying without a valid will
• Just compensation – Fair market value paid by government in a taking
Watch Out For
> ⚠️ Police power requires NO compensation. The government does not pay you for zoning restrictions, even if they reduce your property's value — unless the restriction is so severe it constitutes a "regulatory taking."
> ⚠️ Eminent domain ≠ Condemnation. Eminent domain is the power; condemnation is the process. Know this distinction.
> ⚠️ Inverse condemnation is tested! Remember: the owner initiates the lawsuit — the government never formally takes title.
---
Section 3: Private Land Use Controls
Deed Restrictions (Restrictive Covenants)
A deed restriction is a private limitation written into a deed that controls property use. Key characteristics:
• Created by private parties (developers, sellers)
• Enforced by private parties (neighbors, HOAs) — not the government
• Can be more restrictive than zoning, but cannot violate fair housing laws
• Usually run with the land (bind future owners automatically)
Public vs. Private Controls Compared
| Feature | Zoning | Deed Restriction |
|---------|--------|-----------------|
| Created by | Government | Private parties |
| Enforced by | Government | Private parties / HOA |
| Runs with the land | Yes | Yes (if properly written) |
| Can be waived | Through variance process | Through legal release |
Running With the Land
A covenant runs with the land when:
• It is written into the deed or recorded document
• It is intended to bind future owners
• It relates to the use of the land itself
> Result: Future buyers are automatically bound — no renegotiation required.
When Deed Restrictions and Zoning Conflict
The more restrictive provision controls.
• If deed restricts property to single-family use but zoning allows commercial → deed restriction wins
• If zoning is more restrictive than the deed → zoning wins
• An owner must comply with whichever imposes the greater limitation
Homeowners Associations (HOAs)
• Enforce CC&Rs (Covenants, Conditions, and Restrictions)
• Enforcement tools: fines, liens on property, legal action
• HOA rules are a form of private land use control
• In Texas, HOAs have significant enforcement authority, including foreclosure in some cases
Key Terms
• Deed restriction – Private limitation on property use recorded in the deed
• Restrictive covenant – Another term for deed restriction
• CC&Rs – Covenants, Conditions, and Restrictions; the governing documents of a subdivision or HOA
• Runs with the land – Automatically transfers to and binds subsequent owners
• HOA – Homeowners Association; private body enforcing community rules
Watch Out For
> ⚠️ Deed restrictions CANNOT be used to discriminate based on race, color, religion, national origin, sex, disability, or familial status — even if written into the deed, such clauses are unenforceable under the Fair Housing Act.
> ⚠️ Don't confuse zoning (public, government-enforced) with deed restrictions (private, owner/HOA-enforced). Both can coexist on the same property.
---
Section 4: Subdivisions & Development Controls
Subdivision Plats
• A subdivision plat is a surveyed map dividing land into lots, blocks, streets, and easements
• Must be approved by local authorities and recorded in public records
• Once recorded, it becomes the official legal description for all lots in the subdivision
• In Texas, plat approval is required before lots can be sold in most subdivisions
Master Plan (Comprehensive Plan)
• A long-range policy document guiding future land use in a municipality
• Zoning ordinances must be consistent with the master plan
• The master plan itself is not zoning — it is a planning guide; zoning implements it
Building Codes
• Set minimum standards for construction, materials, design, and structural safety
• Enacted under police power — no compensation paid
• Enforced through the permit and inspection process
• Failure to comply can result in a stop-work order or certificate of occupancy denial
Setback Requirements
• Specify the minimum distance a structure must be from property lines, streets, or other features
• Established by zoning ordinances
• Purpose: ensure light, air, safety, and spacing between structures
• A variance may be sought if strict compliance causes unique hardship
Key Terms
• Subdivision plat – Recorded map establishing lot boundaries and public dedications
• Master plan – Long-range municipal planning document
• Building code – Minimum construction standards enforced by government
• Setback – Required minimum distance from structure to property line or street
• Certificate of occupancy (CO) – Document certifying a building meets code and is safe to occupy
Watch Out For
> ⚠️ The master plan is not zoning — it guides zoning but has no direct regulatory force on individual parcels.
> ⚠️ Building codes apply to new construction AND renovations — a common exam scenario involves a buyer discovering unpermitted work.
---
Section 5: Environmental & Special Land Use Controls
Floodplain Regulations (NFIP)
• NFIP – National Flood Insurance Program
• Special Flood Hazard Area (SFHA) – High-risk flood zone designation
• Properties in SFHA with federally backed mortgages require mandatory flood insurance
• Development in floodplains may be restricted or require elevation requirements
Environmental Impact Statement (EIS)
• Required under NEPA (National Environmental Policy Act)
• Triggered by major federal actions or federally funded projects that significantly affect the environment
• The EIS must analyze potential environmental impacts before project approval
• Purpose: informed decision-making, not necessarily project prohibition
CERCLA / Superfund
• CERCLA – Comprehensive Environmental Response, Compensation, and Liability Act
• Established the Superfund for hazardous waste site cleanup
• Strict liability – Current and prior property owners can be held liable for cleanup costs
• Makes contaminated properties difficult to sell or finance
• Buyers should conduct Phase I Environmental Site Assessment to identify potential contamination
Wetlands Regulation – Section 404 (Clean Water Act)
• Requires a permit from the Army Corps of Engineers before:
- Filling wetlands
- Dredging wetlands
- Developing on federally defined wetlands
• Significantly restricts construction on wetland properties
• Violations can result in fines and mandatory restoration
Key Terms
• NFIP – National Flood Insurance Program
• SFHA – Special Flood Hazard Area (high-risk flood zone)
• NEPA – National Environmental Policy Act; requires EIS for major federal actions
• EIS – Environmental Impact Statement
• CERCLA – Superfund law; hazardous waste cleanup; strict liability for owners
• Section 404 – Clean Water Act provision regulating wetland development
• Army Corps of Engineers – Federal agency granting wetland development permits
• Phase I ESA – Environmental site assessment; due diligence for contamination
Watch Out For
> ⚠️ CERCLA liability is strict — even a current owner who did not cause contamination can be held liable for cleanup costs.
> ⚠️ Flood insurance is not automatic — it must be purchased separately; standard homeowners policies do NOT cover flood damage.
> ⚠️ An EIS analyzes environmental effects but does not automatically block a project — the government still makes the final decision.
---
Quick Review Checklist
Use this checklist to confirm mastery before your exam:
Zoning
• [ ] I can define zoning and explain its purpose
• [ ] I can distinguish a variance from a conditional use permit
• [ ] I know that nonconforming uses can continue but not expand
• [ ] I can explain why spot zoning is often legally challenged
• [ ] I know that variances are granted by the board of adjustment, not the legislature
Government Powers
• [ ] I can recite PETE and explain each power
• [ ] I know eminent domain requires just compensation (Fifth Amendment)
• [ ] I can distinguish eminent domain (power) from condemnation (process)
• [ ] I can explain inverse condemnation and who initiates it
• [ ] I know police power requires no compensation
• [ ] I can define escheat and its trigger conditions
Private Controls
• [ ] I can explain how deed restrictions differ from zoning
• [ ] I know what it means for a covenant to run with the land
• [ ] I can apply the more restrictive controls rule when deed restrictions and zoning conflict
• [ ] I know HOAs enforce CC&Rs using fines, liens, and legal action
• [ ] I know discriminatory deed restrictions are unenforceable
Subdivisions & Development
• [ ] I understand what a subdivision plat is and its legal significance
• [ ] I know the relationship between the master plan and zoning ordinances
• [ ] I know building codes are based on police power
• [ ] I can define setback requirements and when a variance may apply
Environmental Controls
• [ ] I know SFHA properties with federal mortgages require mandatory flood insurance
• [ ] I know an EIS is required under NEPA for major federal actions
• [ ] I understand CERCLA strict liability for current and prior owners
• [ ] I know Section 404 requires an Army Corps of Engineers permit for wetland development
---
Study Tip: On the Texas exam, land use control questions often present a scenario. Ask yourself: Is this a public or private control? Is compensation owed? Which authority (board of adjustment vs. legislature) handles this? Answering these three questions will guide you to the correct answer.