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When purchasing a property, it is important to understand the different types of land estates. An estate in land is the right to possess the land as a tenant for a period of time. In Australia, there are four main types of land estates: freehold estates, leasehold estate, perpetual lease, and strata title. This article will explore the topic of freehold estates and explain the land rights it conveys.

 

What is a Freehold Estate

In essence, a person who has freehold estate has the right to possess a piece of land for a duration of time. The length of a person’s possession is dependent on whether the person has fee simple estate, fee tail estate or life estate.

 

Fee Simple Estate

Fee simple estate is the most common type of freehold estate in Australia, and it gives the greatest rights to land. Practically, if someone owns a fee simple estate, that person has absolute ownership of the land. In light of this, owners of fee simple estates can deal with their estates as they please. For example, owners of fee simple estates can sell, pass on or transfer their property to whomever they like subject to any encumbrances. However, it is crucial to note that if a fee simple estate owner dies without a will and any heirs, then the land will go to the Crown as ownerless goods.

 

Fee Tail Estate

Fee tail estate has been abolished in most states in Australia, except in South Australia and parts of Tasmania. The main difference between fee tail estate and fee simple estate is that the former can only be passed on to the owner’s lineal descendants. (i.e. a child or grandchild) Given this, fee tail estate is often used to keep land within a particular family. Like fee simple estate, if the owner of a fee tail estate dies without a will and any heirs, then the land will also go to the Crown as ownerless goods.

 

Life Estate

A life estate is usually granted to a person by the estate owner for the remainder of that person’s life. A life estate will allow the holder to have a temporary right to possess a piece of land. Once the holder of a life estate passes away, their interests in the land will cease. During the holder’s lifetime, they may grant their life estate to others. However, as mentioned above, once the holder passes away, the right to possess the land will return to the original landowner.

 

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Please note that this article does not constitute legal advice and Straits Lawyers will not be legally responsible for any actions you take based on this article.