When you are buying property in NSW, you will encounter a lot of legal terms that might seem confusing at first, but they are important in clearly laying out the responsibilities, rights, and ownership details that come with buying property in NSW. One of the most important distinctions to understand is the title. It affects everything from how much control you have over the property to what you’re responsible for maintaining, and even what fees you may need to pay.
The two most common types of property titles in NSW are Torrens Title and Strata Title. While they both establish ownership, they work in very different ways. This article explains the key differences between Torrens and Strata Title so that you can make a confident, informed decision and avoid unexpected costs or complications after the settlement of your property.
Property title types of NSW
In the simplest terms, a property title is your legal proof of ownership document, and applies to all property types across NSW, including stand-alone homes, apartments, townhouses, and commercial real estate. It records who owns the land or building and outlines any legal interests, restrictions, or rights attached to that ownership. Strata Title and Torrens Title are two of the most common types of property titles that you are likely to encounter when you are buying property in New South Wales. The type of title significantly affects key aspects of property ownership, including:
- Maintenance Responsibilities: For example, strata title owners must maintain only the interior of their unit, while the body corporate handles common areas.
- Costs: Different title types come with varying ongoing costs, such as strata levies, community fees, or lease payments.
- Legal Rights: Ownership rights can vary depending on whether the property is freehold, leasehold, or part of a shared title.
- Resale Value: Certain titles may be more attractive to buyers due to perceived control, lower fees, or simpler legal structures.
What Is Torrens Title?
Torrens Title is the default type of property title in NSW and will very likely be the title on any standalone properties that you are considering purchasing. Torrens Title means that when buying a standalone property, you buy the property and the land on which your property is built. Some townhouses will use Torrens Title, and almost all detached houses will.
In practice, what this means is that all of the rights and responsibilities of the property are yours alone. You will be solely responsible for the maintenance, council rates and insurance, and will also receive the proceeds of the land and property if and when you sell.
Torrens Title is a simple and direct form of property ownership, where the owner holds full title to the land and dwelling. In most cases, it does not involve any shared obligations with neighbouring properties. However, some Torrens Title properties may still be subject to certain restrictions or shared elements such as easements, covenants, or inclusion in a community or neighbourhood scheme, which can create limited shared responsibilities.
Because you own the land, Torrens Title properties often have a higher purchase price. This land component may also contribute significantly to long-term capital growth. However, appreciation depends on factors like location, condition, and overall market demand.
What Is Strata Title?
In contrast to Torrens Title, instead of sole ownership over your property and the land that it sits on, you buy and own your home when you buy a property under Strata Title, plus a shared portion of the common areas and land that your property sits on.
Strata Title properties are governed by a legally registered strata scheme and managed by an owner’s corporation, which is made up of all the individual lot owners in the complex. This body oversees the management of the common property and is responsible for organising repairs, maintenance, building insurance, and compliance with relevant laws. Your obligations when buying into this type of property title involve:
- Paying quarterly strata levies, which go towards expenses, admin, and a sinking fund.
- Complying with strata by-laws such as rules around pets, renovations, and noise.
- Participating in owners’ meetings and votes to ensure that your perspective is heard and considered with the needs of the other owners.
Considerations for NSW property buyers
The type of property title a property has is unlikely to be the only thing that determines the property you choose to buy, but it does have a significant impact on lifestyle, costs, and long-term value, so it is worth considering what you want out of your property and how it aligns with the options you have.
Lifestyle Needs
When considering the differences between Torrens Title and Strata Title, consider how you want to live. Torrens Title properties offer greater independence and control. You own the land and are responsible for its upkeep. This appeals to those who value privacy and autonomy.
On the other hand, strata title living often involves shared responsibilities, such as maintaining common areas like gardens, driveways, or lifts. This can be ideal for those seeking a lower-maintenance lifestyle with fewer individual obligations.
Costs
Strata properties usually involve ongoing levies that cover shared expenses like building insurance, common area maintenance, and administration. These levies can increase over time, so it’s important to review the strata’s financial records, especially past budgets and the sinking fund balance, to understand any upcoming costs.
Torrens Title properties generally don’t have shared levies, but you’ll be solely responsible for all maintenance, insurance, and repairs. While the upfront purchase price can be higher, the absence of ongoing strata fees may lead to more predictable long-term costs.
Resale and Investment Value
Buyer preferences differ. Some buyers are drawn to the simplicity and independence of Torrens Title, which can enhance resale appeal. However, strata properties tend to be more affordable and are often located in high-demand urban or coastal areas, factors that can also make them attractive to investors and first-home buyers. That said, strata properties are increasingly common in regional and suburban areas as well, not just cities.
Due Diligence Before Buying Strata
Before purchasing a strata property, it’s crucial to review the strata report. This should include details about the bylaws, financial statements, insurance coverage, and any existing or past building defects. Be on the lookout for red flags, such as upcoming special levies, poor financial health of the strata scheme, or ongoing legal disputes.
Due diligence and legal checks
Whether you’re buying a Torrens Title home or a Strata unit, conducting thorough legal checks before signing the contract is essential. Each type of property comes with different legal responsibilities, restrictions, and risks, and a legal professional who is deeply familiar with conveyancing in NSW will be able to help you navigate the due diligence and legal checks that are recommended for each of these property types.
From title searches and zoning regulations to strata by-laws and financial reports, checks can uncover critical issues that may affect your decision or the property’s long-term value. Here’s what to look out for, and how a conveyancer can guide you through the process, depending on the type of property you’re purchasing.
Torrens Title
If you’re purchasing a Torrens Title property, your conveyancer will guide you through the following essential checks:
Title Search & Contract Review: A thorough review of the title search and contract of sale ensures there are no surprises, such as caveats, restrictive covenants, or encumbrances on the property.
Boundaries and Easements: Confirm the exact boundaries of the land, and check for any easements that may affect access, drainage, or future development.
Zoning and Land Use Restrictions: Understand the local zoning laws to ensure the property’s intended use (e.g. residential, home business, future renovations) is permitted.
We help you identify and assess any legal risks before you commit to the purchase.
Strata Title
Buying into a strata scheme involves more than just the unit — you’re also buying into shared ownership and responsibilities. Key due diligence includes:
Title Search & Contract Review: As with Torrens Title, we’ll review these documents to check for any encumbrances or special conditions attached to the lot.
Strata Report Review: We recommend ordering a pre-purchase strata report. This includes the financial position of the scheme, any building defects, planned or proposed special levies, insurance status, and history of disputes or litigation.
By-Laws Review: Strata by-laws govern how the property can be used, covering pets, short-term rentals (e.g. Airbnb), renovations, noise, and parking. We ensure you understand any restrictions that may affect your lifestyle or investment plans.
Common Property and Maintenance Obligations: We clarify which areas are your responsibility versus the strata’s, and advise on the implications of any upcoming major repairs or projects.
Engaging a conveyancer in NSW early allows us to flag potential issues, explain your rights and obligations, and help you proceed with confidence.
Conclusion
Understanding the difference between Torrens and Strata Title conveyancing is crucial when buying property in NSW. Each title type comes with its own legal structure, financial commitments, and lifestyle implications, and the right choice will depend on your personal needs, goals, and budget.
At Bush to Beach Legal, we guide buyers through every step of the process to ensure you’re fully informed and legally protected before you sign. Whether you’re considering a Torrens Title home or a Strata unit, early engagement with an experienced conveyancer can save you from unexpected costs and complications down the track.
Ready to take the next step? Contact us today to discuss your property plans with a conveyancing team you can trust.
Disclaimer: The information in this article is general in nature and does not constitute legal advice. Every property transaction is unique, and we recommend speaking with our team to get advice tailored to your specific situation.
