A Scottish Government project to create a map-based, publicly-available Land Register by 2024 could have major financial implications for Tayside property owners.
That’s the opinion of Alistair Duncan, a property law expert at Tayside Solicitors and Estate Agents, Miller Hendry, who has been weighing up the pros and cons, now that an integral part of the initiative has gone live in some Dundee and Angus postcodes (including Broughty Ferry and Monifieth).
Alistair Duncan, Partner at Miller Hendry and Head of both Commercial and Residential Property, said: “While there are clear benefits to having a new digitised Land Register providing clear and up-to-date information about land values and ownership, we are coming across a number of situations whereby clients are having to meet substantial costs with no benefit apparent to them.”
Last year, Registers of Scotland (RoS) started to move land and property titles from the deeds-based General Register of Sasines onto the map-based Land Register within areas of Angus, Dumbarton and Midlothian
This is being done through a new power, Keeper-induced Registration (KIR), which allows RoS to transfer titles from one public register to another without an application from the owner.
Meanwhile, the General Register of Sasines closed to standard securities on April 1, 2016, meaning applicants planning to use a new lender to re-mortgage or take out additional lending secured on their existing Scottish property may need to prepare an additional application to move a title onto the Land Register.
It is understood that the customer will still pay the same fee of £60 to register the standard security, with the normal registration fee charged by Registers of Scotland to move onto the Land Register then being waived. However, solicitors may charge for additional work by them which is required for the application to the Land Register.
The change will not affect those wishing to re-mortgage with an existing lender, as monies are rolled into the same account, with no need to check title deeds.
Some property transfers where no price is paid are also affected by these changes and what was once a relatively straightforward procedure now involves additional legal work and outlays. A new deed plan is also often required.
Explained Alistair Duncan: “An example would be a gift between husband and wife or parent to child, or where property is inherited from an owner who has died.
“The additional costs incurred will vary from case to case and from firm to firm but, as an indication, the extra work involved in an application for a first registration of title could increase legal fees by around £300 including VAT. This could be more where the title is of a complex nature or where there are problems with determining the extent of ownership which can often happen with older titles.
“Clients may also be looking at additional costs for deed plans, which are not prepared by lawyers and generally outsourced to surveyors or some other specialist provider at a cost of around £100, and pre-registration reports from Registers of Scotland which can cost up to around £70.
“These costs mount up so most property owners are facing costs of around £500 or more, not including the registration dues charged by the Land Register which are based on the value of your property.”
Mr Duncan continued: “The new scheme is undoubtedly affecting those who wish to provide a legacy for their loved ones. In recent years, there has been an increase in the elderly considering equity release schemes and they are set to particularly suffer as a result of this drive to complete the Land Register.
“A re-mortgage of a Sasine title will likewise trigger a compulsory registration in the Land Register, thereby increasing the costs of re-mortgaging with a new lender for some property owners. Again, it is likely that this will impact on elderly clients as many elderly clients have remained in the family home and their titles are recorded in the Sasine Register.”
One of the aims of the Land Registration (Scotland) Act 2012 is to speed up completion and modernisation of the Land Register of Scotland. The Land Register, a map-based register of titles, was brought into effect in 1979 to replace the existing General Register of Sasines, also known as the Sasine Register.
Dating back to 1617, the Sasine Register is the oldest public register of land ownership in the world. However, it is not map-based and is instead a chronological list of land deeds. After introduction of the Land Register in 1979, progress of completing the registration of all titles to land in Scotland has been slower than originally though.
As an incentive, the Scottish Government is encouraging voluntary registration of Sasine titles by offering a 25% discount on the registration dues charged by Registers of Scotland to those property owners who voluntarily register their property in the Land Register but, by doing so, existing property owners will still incur the legal costs and other outlays.
Alistair Duncan added: “As unintended as the consequences of Land Registration may be, the implications are not just affecting home owners but public authorities too, with the Government insistent that their properties are also placed on the Land Register. This is a mammoth task which is tying up legal departments of public authorities across Scotland. It also begs the question of whether it is an effective use of what are already stretched and limited public resources.”
For further advice or for information about Miller Hendry, visit www.millerhendry.co.uk