A – Z OF PROPERTY TITLES

certificate-of-property-title

GREEN VS PURPLE VS STRATA VS SURVEY STRATA

There are a number of different types of property titles in Western Australia. Many are completely unknown to the majority of people and are rarely encountered. However, when purchasing a home, the type of title your property falls under can affect your right of use, so it’s important to understand the differences between each title.

Whether buying an established property or building a new property, your home will generally fall into one of four title categories; green title, purple title, strata title or survey strata.

Green title

A ‘green title’ property refers to land that generally has no common areas that need to be shared (unless otherwise indicated on the certificate of title).

The large majority of land sold in Western Australia is green title and is most commonly a property that houses a free-standing home. The reason it’s often referred to as ‘green title’ is simply because the sketch on the certificate of title used to be shaded in a green colour.

If the property you’re looking to buy is green title, be aware that it can still come with restrictions or instructions for how the land can be used e.g. the Water Corporation may have a right to install or access a sewer line, and depending on the location of the sewer line, it could potentially restrict your ability to install a pool or build an extension. The local government authority, particularly in rural areas, could also restrict where a building can be placed on the property – which is known as a ‘building envelope’.

To avoid any surprises after purchase, make sure you thoroughly check the title for any restrictions and be sure to make any other relevant enquiries with your real estate agent before making an offer to purchase.

Purple title

After the end of the Second World War there was an increase in the number of multi-storey residential properties, but no legal system available to divide the building and create separate titles.

To overcome this issue the ownership was transferred to a company whose rules provided that the holders of company shares were entitled to occupy specified parts of the building. Ownership was secured by relying upon shareholding rather than title to land. This ownership is now often referred to as ‘purple title’.

There are not many of these older types of properties remaining in Perth, but there are some new developments that are being created under purple title – particularly in retirement villages. If the property you purchase is ‘purple title’, then you should determine if there needs to be an agreement among shareholders that you can occupy the advertised property upon transfer of the shares in the company.

Strata title

The requirement for buyers to obtain secure title to parts of a building led to the Strata Titles Act being created.

The owner of a strata lot typically has sole ownership of a cubic space and a common ownership of the land and buildings on which the cubic space is located (be sure to consult the title document to determine exactly where the boundaries of the strata lot are located).

If you are an owner of a strata lot, you will also be allowed to use parts of the property that are deemed to be ‘common property’, however this is a shared space that you would co-use with other property owners who have rights to the same space.

Common property generally includes:

◦Communal laundries

◦ Swimming pools

◦ Gymnasiums

◦ Communal activity areas/hire rooms

◦ Stairwells

◦Lifts

◦Driveways

◦Gardens

Of all the types of titles, strata titles come with the most responsibility for buyers as there are a number of duties and restrictions that are likely to apply, such as;

◦you will be subject to any by-laws or rules of the strata company.

◦ you will be required to pay levies to administer the strata scheme, including insurance for the common property, maintenance and any repairs to the common property that are required.

◦you will be eligible to attend meetings to discuss and vote on issues, such as setting of budgets for expenses for repairs and improvements to the complex.

Your REIWA real estate agent will be able to assist you with understanding your rights and obligations with living in a strata complex.

Survey strata

The final type of title is survey strata, which is generally used for single tier developments where lots are side by side. Typically this involves an existing large green title lot being formally surveyed into smaller subdivided lots with distinct boundaries. The subdivided lots are created under the Strata Titles Act and are known as ‘survey strata’.

The rights and obligations of survey strata title is essentially the same as a green title. Some survey strata developments can have a commonly owned driveway and all owners in the survey scheme will contribute towards the insurance and maintenance of that common property that has a separate lot number.

If you’re looking to purchase a survey strata property, it’s a good idea to check with your real estate agent if there are any building restrictions you should be aware of.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s