What Can a Title Search Reveal About a Property? Hidden Issues to Watch For

Buying property in New South Wales is a significant investment, and ensuring you have all the right information before committing is essential. One of the most important steps in this process is conducting a title search. This legal check provides detailed information about a property’s ownership, rights, restrictions and any potential issues that could affect your purchase or future use.

Understanding what a title search reveals and recognising hidden problems can save you from costly surprises. This guide explores what a title search involves, the kind of information you can expect, and the common hidden issues that buyers should watch for when purchasing property in NSW.

What Is a Title Search?

A title search is an official inquiry into the public records held by the NSW Land Registry Services. It provides details about the registered ownership of the land, any legal interests or restrictions attached to the property, and its precise boundaries.

The title is the legal document proving who owns the land and what rights they have over it. A title search confirms the name of the owner and reveals any financial interests, easements, covenants or disputes associated with the property.

In NSW, a title search is a routine part of the conveyancing process when buying or selling property. It ensures buyers receive clear title before settlement, protecting their legal rights.

What Information Does a Title Search Provide?

A title search contains a range of information crucial to understanding the property’s legal status. Key details typically include:

Registered Proprietor

The title search shows the full name of the registered owner or owners of the property. This confirms who has the legal right to sell or deal with the property.

Property Description and Boundaries

The search provides a detailed description of the property, including lot and plan numbers, street address, and land boundaries. This information is supported by survey plans which help avoid boundary disputes.

Title Reference Number

This is a unique identifier for the property within the NSW Land Registry, making it easy to track all dealings and interests linked to the title.

Registered Interests and Encumbrances

Encumbrances are legal claims or restrictions affecting the property. These may include mortgages, easements, covenants, caveats or other charges. Understanding these is critical because they may limit what you can do with the property or indicate outstanding debts.

Mortgages and Charges

If there is a mortgage registered on the property, this will appear on the title. It means there is a financial liability that usually must be discharged before transfer of ownership.

Easements

Easements grant rights to others to use parts of the property for specific purposes, such as utility access or neighbour’s right of way. These can impact your use and enjoyment of the land.

Covenants

Covenants are conditions placed on the land by previous owners or developers, often relating to how the property can be used, building styles, or restrictions on fencing and landscaping.

Caveats

A caveat is a formal notice lodged by someone claiming an interest in the property. It alerts potential buyers to unresolved claims or disputes that may affect ownership.

Plan of Subdivision

This shows how the land is divided and where your property fits within a subdivision, which is useful for units or strata titles.

Why Conduct a Title Search?

A title search provides transparency and protection for buyers. It verifies ownership, uncovers existing debts or restrictions and highlights any potential legal complications.

Without a title search, you might buy a property that has unresolved mortgages, limits on use, or boundary issues. These problems can cause delays, financial loss and legal disputes after settlement.

Lenders also require a clear title before approving home loans as they use the property as security.

Hidden Issues a Title Search Can Reveal

Many issues are not visible during a property inspection but appear on the title search. Some of the common hidden issues to watch for include:

Undisclosed Mortgages or Financial Charges

Sometimes sellers fail to mention existing mortgages or charges on the property. These must be settled or transferred at settlement to ensure you receive a clear title.

Easements Impacting Use

Easements can allow neighbours, utility providers or councils to access or use part of your property. They may restrict where you can build or place structures.

Restrictive Covenants

Covenants might prevent certain uses, such as running a business from home or erecting particular fences. They can also require you to maintain a certain appearance or style, limiting your freedom.

Caveats and Disputes

A caveat lodged against the title signals someone claims an interest in the property. This could be a former owner, family member or creditor, and may delay or prevent settlement.

Boundary Disputes

Disputes about the exact boundaries of the property may be noted on the title or arise from conflicting plans. Resolving these can be expensive and time consuming.

Unregistered Tenancies or Leases

Some tenants may have agreements that are not formally registered but still bind the new owner. These can impact rental income or possession.

Heritage or Environmental Restrictions

Some properties may be subject to heritage listing or environmental protection laws. These often require special permits before making changes.

How to Obtain a Title Search in NSW

You can order a title search through NSW Land Registry Services either online or in person. Most buyers arrange for their solicitor or conveyancer to obtain the search as part of the conveyancing process.

To request a title search, you need the property’s street address or lot and plan numbers. The search typically costs a small fee.

The document you receive will contain all the registered details about the property and should be carefully reviewed.

What to Do If the Title Search Reveals Issues

Finding issues during a title search can be worrying, but there are steps you can take:

Get Professional Advice

Engage a property lawyer or conveyancer to explain any concerns and advise on your options.

Negotiate with the Seller

You can ask the seller to resolve problems such as outstanding mortgages or remove restrictive covenants where possible.

Consider the Impact

Some restrictions or easements may be acceptable depending on your intended use. Others may require reconsidering your purchase.

Conduct Further Checks

You might want additional inspections or surveys to clarify boundaries or other concerns.

Tips for NSW Property Buyers

• Always include a title search in your due diligence before signing contracts.
• Use qualified conveyancers or solicitors experienced in NSW property law.
• Be alert for caveats and encumbrances that could complicate the sale.
• Factor in time and costs for resolving any issues revealed.
• Do not rely solely on the property inspection to uncover legal or financial problems.

Conclusion

A title search is a vital step in purchasing property in New South Wales. It reveals who legally owns the property, any financial interests, restrictions and hidden issues that could affect your rights.

By conducting a thorough title search, you protect yourself from unexpected legal complications and make a well-informed decision. Always seek professional advice to understand the findings and handle any problems that arise.

Taking this careful approach ensures your property investment is secure and that you can enjoy your new home or business without unforeseen troubles.