All land in England and Wales is currently, slowly but surely, being registered at HM Land Registry. Soon the days where lawyers have to delve through old deeds trying to read what some poor legal clerk once wrote by hand will be gone. There is not much land left that needs to be registered, about 88% of all land is registered, but unregistered land still exists nonetheless. This blog aims to outline the potential problems you might encounter when selling unregistered land.
To make things more straight forward and for ease of explanation, let’s say you own the unregistered freehold of a house that you live in.
Do I need to register my land?
No, you do not need to register your land out of the blue if you don’t want to. However, the law now states there is compulsory registration where there is:
- A transfer of a qualifying estate* by gift or any other consideration value
- A transfer of a qualifying estate by assent (see later)
- A creation of a trust in land
- A grant of a lease with a term of more than 7 years
- And more…
*a qualifying estate is a freehold or leasehold legal estate in land.
Selling unregistered land in your lifetime
Registered land is more straightforward to sell. When unregistered land is sold, the purchaser’s solicitors usually have the job of registering it, meaning the purchasers bear the cost. Although they may request it be registered before the sale, leaving you to bear the cost and delaying the transaction. Either way it is still an administrative task that needs to be done and might make what seems like a simple sale and purchase transaction into something more complex.
Some unregistered land is very old, you might have owned your house for as long as you can remember, or it might have been in the family for generations with no need to register it. The real world is constantly changing and evolving, old deeds and plans are stuck in time and may no longer accurately reflect the land you own.
There is also the problem of non-compliant plans, the requirement for a registrable title plan is that it needs to be identifiable on an ordinance survey map. Commonly a land registry compliant plan will require:
- A northern point
- Road names
- A scale (commonly 1:250 or 1:500)
Old plans that were hand drawn will likely not be identifiable on an ordinance survey map, meaning new plans will have to be professionally produced. It is always a good idea to get these produced well prior to selling your property. Many problems can reveal themselves when producing new plans. For example, boundaries could have moved over a period of decades, or a ransom strip may have appeared between your property and the highway. These problems should ideally be dealt with before you come to sell your property.
Unregistered land after death
Even if you don’t intend on selling your house in your lifetime, an assent** also triggers compulsory registration. The costs of first registration is still going to be paid by your estate, reducing the amount the beneficiaries are entitled to, and having to register the land will delay when your beneficiaries receive their share of your estate.
**where personal representatives of an estate transfer legacies or the whole/part of a deceased’s residuary estate to a beneficiary.
Finally, voluntary registration by its nature will trigger a title investigation that the solicitor will have to carry out. This will provide clarity about the extent of your title and the legal/equitable interests that people have in it. Registering these interests, if they are registerable, provides more clarity not only to you as the freeholder but to a potential purchaser. The purchaser’s solicitor will not have the burden of the doctrine of notice and the transaction should be smoother.
There are plenty more reasons as to why voluntary registration is beneficial, including reduced Land Registry fees, but the above provides an outline of the main implications you might encounter when selling unregistered land.
If you would like more information, or if you would like to voluntarily register your land, please contact a member of our property team at 01494 521301.