What does the term "remainder interest" signify in property law?

The term "remainder interest" in property law specifically refers to an interest in property that becomes effective after the termination of a prior interest, most commonly a life estate. In this context, it signifies a future interest that a person holds in real property that will take effect upon the death of the life tenant or the termination of their interest.

When a property owner grants a life estate to one person, they may designate another individual to receive the property once the life estate ends. This second individual's future interest is the remainder interest. It is a key concept in understanding how property can be transferred upon death and how ownership can be structured across different parties.

In summary, the remainder interest ensures that the property will automatically transfer to the specified heirs or beneficiaries after the initial interest holder (the life tenant) has passed away or the term of their interest has ended. This is why it is aligned with the notion of automatic transfer to heirs, making the selected answer accurate.