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A wall that is located on or at a boundary line between two adjoining parcels and is used, or is intended to be used, by the owners of both properties in the construction or maintenance of improvements on their respective lots. This wall is often designed to serve simultaneously as the exterior wall of two adjacent structures, built and maintained under a recorded agreement. Both neighbors need to agree on their respective rights so that both properties become more marketable.

A party wall may be created by agreement, deed, or implied grant. Though it is most often centered, the party wall may be located entirely on one lot. Typically a perimeter wall joining two attached houses and giving structural support to both, a party wall is most frequently encountered in row or tract houses in highly developed urban areas where property owners wish to make full use of the width of their lots and to share the building and maintenance costs. The duty to repair a party wall falls equally on both owners, and one owner may not use his or her rights to the wall in such a way as to damage a neighbor.

Each owner holds in severalty that cross-portion of the wall on his or her tract subject to an easement, called a cross-easement, by the other owner for use of the wall as a perimeter wall of each owner’s respective building and for its support. Because a party wall involves an easement, the agreement should be in writing, as required by the statute of frauds. The right to a party wall can also arise by prescription, as where a surveyor’s error causes a wall to encroach on adjoining land and such encroachment continues for the prescriptive period.

When one property owner decides to build, he or she may enter into a party-wall agreement with neighbors. Under a typical agreement, neighbor Girish will build first, and then at such time as next-door neighbor Kiran decides to build on his lot and use the wall, Kiran will pay Girish for one-half the cost of the wall. A party wall is also used, for example, if Girish owns two lots and builds a house on each, with one wall dividing the two houses and serving as the perimeter wall of each.
Dearborn Real Estate Education
This "Word of the day" is excerpted from The Language of Real Estate, 6th Edition by John Reilly (published by Dearborn Real Estate Education, 2006 copyright). To purchase the complete book, with over 2800 key terms and definitions, or to browse through Dearborn's hundreds of other professional real estate titles, including Real Estate Technology Guide by Klein, Barnett, Reilly, click here.
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