‘Good to know series’ | Part 3: What does ‘Limited Title’ mean?
Thousands of properties in NSW, are designated by the Land Registry Services (LRS) office as having ‘Limited Title’. But all it means is that the boundaries of the property have not yet been surveyed. Which can be remedied if necessary.
‘Limited Title’ can be removed by a registered surveyor registering an accurate survey of the land with the LRS. A plan of delimitation requires the surveyor to re-establish the original deed boundaries and to compare those boundaries with existing occupations (including buildings constructed) on the land.
This can be more expensive than a standard surveyor’s plan of the land, and there are some LRS registration costs.
Before purchasing a ‘Limited Title’ property, it is advised to have a survey done to confirm there are no boundary encroachments. It is also a good idea to take out title insurance, which is a low-cost way of protecting yourself if it turns out that the boundaries as understood at the time of purchase are significantly different. (Discuss options with your legal representative)
If you want to develop/subdivide ‘Limited Title’ land, you may be required to register a plan of delimitation with LRS.
It may also be difficult to gain approval for a home loan for a property with a ‘Limited Title’, some banks and lenders in Australia will be reluctant to lend on ‘Limited Title’ properties without the property being surveyed. While ‘Limited Title’ has little impact on a property in 2022, some banks are still cautious about lending as there could potentially be a misdescription on the boundaries or easements. For this reason, some lenders will refuse to lend on ‘Limited Title’ property.
If you are considering purchasing a property with a ‘Limited Title’, it’s best to have the limitation removed by working with your legal advisor.