What does "Fee Simple" mean?

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Fee simple is often referred to as “an estate in fee simple” or “freehold”. (Freehold not to be confused with having no mortgage).  A fee simple title is considered to be the title that has the greatest benefit to the owner in respect of enjoyment and use.  

The advantages of fee simple is that you own the whole of the land and are able to make any additions or alterations to your property (subject of course to Council bylaws and consent requirements) without having to get the consent of neighbouring property owner(s) unlike a cross lease title and unit title.  

An owner can also register what are called “restrictive covenants” against their title to restrict future owners as to what they can build on the land.  This is most common for example, where an owner owns a large parcel of land (lot) and is subdividing it into smaller parcels (lots) and wants to place height restrictions on the future lot owners so they can protect their view. There may already be covenants registered against the title to the property that impose these restrictions so you should make sure you are aware of these by having your legal advisor search and review the title for you. 

An example of a legal description to a fee simple title is, 1234 square metres more or less being Lot 1 on Deposited Plan 12345

If you have any questions regarding the above, or wish to seek advice regarding buying residential property, please contact property lawyer Wade Hansen by phone on 837 6885 or email wade.hansen@smithpartners.co.nz

 

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