What is reversion in real estate?

Reversion in real estate refers to the eventual transfer of ownership of a property back to the original owner, or to his or her heirs or assigns. This transfer occurs at the end of a lease or other limited term of ownership, when the property reverts to the person or entity that originally owned it. The right of reversion is often included in lease agreements and other contracts, and is also common in trusts and other estate planning arrangements. Reversion can be either automatic or subject to certain conditions, such as payment of a specified sum of money or the fulfillment of other agreed-upon obligations. In some cases, reversion may also involve the transfer of rights and interests in the property to a third party, such as a bank or other financial institution. Overall, reversion is an important concept in real estate and estate planning, as it helps to ensure the proper transfer and ownership of property over time.