When buying a property, there are many different things to think about. How much do you want to spend? Where do you want to live? Do you want a freestanding house or a unit? Would an apartment suit your lifestyle? Something that probably isn’t first on your list to consider is the type of property title you’d like.
In South Australia there are many different property types available – Torrens, Community, Strata and more – and there are pros and cons to each of them. In this article we examine what the differences are between the types of titles available and what you should take into consideration before purchasing one.
Definition: An allotment of land that is completely independent of any others, and generally does not feature any shared services.
This is the most common type of property title in South Australia and is what would apply to most freestanding homes across the state. There may be things such as easements and encumbrances on the property, but generally you have control over the entire property with a Torrens Title making it a pretty safe bet to purchase. This type of title was actually invented in South Australia by Sir Richard Robert Torrens and revolutionised the recording of land ownership!
If you’ve ever come across a property that says its ‘freehold’, this is just the same as Torrens Title.
Definition: Strata Titles are generally associated with units, townhouses and commercial properties, in which the land is divided into units owned by individuals, with the common areas jointly shared by all owners.
With strata properties, a strata corporation made up of the individual owners of the titles, is created to manage and maintain the common property, such as common areas and driveways. They also need to meet at least once a year to discuss any relevant matters. This type of ownership is quite a common in units and townhouses, however it can be quite restrictive if the corporation chooses to impose rules, such as not being able to have pets or not being able to change the exterior of the property. Before purchasing a Strata Title, make sure you look into how well the property is being managed and whether it has a maintenance plan, what the annual fees/levies might be and if it is properly insured so that you’re well aware of what you’re getting yourself into.
It is actually no longer possible to create new Strata Titles, however existing schemes continue to be regulated under the Strata Title Act 1988.
Definition: A Community Title is evidence of ownership of a lot in a community plan. There can be two types of Community Title – Community Scheme or Community Strata Scheme.
Basically, a Community Title can be used when there are at least two allotments with an area of common property, such as a shared driveway or service infrastructure. The owner of each lot is responsible for the building on their lot, and a community corporation is established to look after any infrastructure in common areas.
If you think this sounds similar to a Strata Title you aren’t the only one! The key difference lies in the way boundaries are defined, insurances you need to pay and how by-laws are enforced. In reference to the boundaries, Strata Titles are only defined by parts of the building, whereas on a Community Title it may also include additional areas of surveyed land. As an example, this might mean you have full responsibility of your own backyard. When it comes to insurance, Strata Corporations are required to take out building and public liability insurance for the full property. A Community Corporation only needs to take out these insurances for common areas, with individual lot owners responsible for their own areas. Finally, when it comes to enforcing by-laws, Community Corporations have more legal power and can even impose penalties of up to $500 if the rules are breached. If you’re still feeling confused by the differences we suggest checking out this fact sheet from the Department of Planning, Transport & Infrastructure.
Like when buying a Strata Title, it is important to look into the management and maintenance of the property, the community plan, the by-laws and other general information to make sure the property is suited to you and your lifestyle.
Definition: When a company is registered on the Certificate of Title as the sole owner of the land a group of units occupies. Instead of directly owning the land, individual owners are issued with a share certificate of the company.
These types of titles were used for groups of units prior to 1967. While they are now quite uncommon in South Australia there are still some that exist. It is now possible to convert a company title into a Torrens or Community Title with the assistance of a conveyancer and surveyor.
Definition: a Moiety Title is a type of Company Title where an individual is a registered owner of a share of the land.
Often referred to as a cross lease, in these situations the owner is leasing a right to occupy their unit and gain access to the common areas. Like Company Titles, this is now a fairly uncommon type of title in South Australia but is still seen from time to time.
With over 20 years of experience in the conveyancing industry, we know the meanings of these titles like the back of our hand, and have experience with buying, selling and subdividing them all. If you’re looking to buy or sell a property and are confused by what the type of title is, get in contact with us today