In the American West, water rights are separate from land ownership and governed by the doctrine of prior appropriation: “first in time, first in right.” A landowner does not automatically have the right to use water flowing through or under their land — that right must be separately acquired and maintained through use.

For community development in the Southwest, water rights assessment is as important as title search. Key questions include: Does the property have existing surface water rights? What is the priority date of those rights? Are there groundwater rights? Is the proposed water use (domestic, agricultural, commercial) covered by existing rights? What is the process for acquiring new rights if needed?

Rainwater harvesting is legal in most states (New Mexico explicitly permits it) and represents an important strategy for supplementing water rights. A well-designed community can harvest substantial precipitation from roof surfaces without implicating water rights law in most jurisdictions — though this should be confirmed with local counsel.