Easements can affect your property’s value depending on their purpose and how they impact your land. In many cases, they don’t have a huge effect on property value, but there are some instances when they can. For example, an easement might limit where you can build, which could complicate plans for renovations or extensions. This article covers key points you need to know about easements, and what to watch out for when reviewing a property contract.
Key Points Covered
- Easements explained
- Easements to watch out for
- Benefits of a conveyancer
What Are Easements?
An easement essentially gives someone else the right to use part of your property for a specific purpose, even though you still own it. Here are some common types:
- Right of way: Allows someone to pass through your property to get to theirs.
- Utility easements: Give utility companies access to things like power lines or water pipes on your land.
- Drainage easements: Allow water to flow across properties to prevent flooding.
- View easements: Protect scenic views by limiting what can be built or planted in certain areas.
Some easements are useful, like providing access to utilities, but others might restrict how you use parts of your property.
How Easements Can Affect Property Value
1. Limits on What You Can Do with the Land
Easements can restrict how you use certain parts of your land. For instance, if there’s a utility easement, you might not be allowed to build on that area or plant trees. This could lower the property’s value, especially if you had plans for future development or extensions.
2. Impact on Privacy and Enjoyment
Easements like a right of way could affect your privacy or how much you enjoy your property. If neighbours or even the public have the legal right to walk or drive through part of your land, it could make the property less appealing to future buyers, potentially affecting its market value.
3. Shared Maintenance Responsibilities
Some easements, like shared driveways, come with the responsibility of upkeep. You might have to share the cost and work with a neighbour to maintain a driveway or a fence, for example. These added responsibilities can sometimes make a property less attractive to buyers and may affect how much the property is worth.
4. Impact on Future Development
Easements can also affect your ability to develop the property in the future. While some easements might add value by allowing access to utilities or roads, others could limit your ability to expand or build on the land, which might reduce its long-term value.
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What to Watch Out For With Easements
If you’re considering buying a property, it’s essential you review the contract and look out for easements, especially:
1. Hidden Easements
Not all easements are obvious during a property inspection. Some are only discovered when a thorough title search is done, which is why having professional help (like conveyancing) is important when buying property.
2. Outdated or Vague Terms
Older easements may have unclear or outdated terms, which can cause confusion or even disputes later on. It’s important to fully understand any easements on a property and what they mean for you as an owner.
3. Shared Maintenance Agreements
If an easement involves shared maintenance, like a common driveway, it’s important to make sure there’s a clear agreement in the property contract about who’s responsible for what.
4. Potential Disputes
Easements can sometimes cause disagreements with neighbours or utility companies, especially if the terms are unclear or if one party feels their rights are being ignored. Knowing your legal standing is important to avoid or resolve these disputes quickly and fairly.
How a Conveyancer Can Protect Your Interests
Dealing with easements can be complicated, but having a conveyancer on your side can help make things clearer and protect your interests when buying or selling property.
1. Conducting a Thorough Title Search
A conveyancer can carry out a detailed title search to find any easements attached to the property. This is an important step because not all easements are visible during an inspection, and some might only be found through legal documents.
2. Reviewing and Interpreting Legal Documents
Easement documents can be full of legal jargon that’s hard to understand. A conveyancer will break it down for you, explaining the terms in plain language so you know exactly what your rights and responsibilities are.
3. Advising on Property Value and Use
Based on their knowledge of local laws and the specifics of your property, a conveyancer can offer advice on how the easements might affect the property’s value and what you can or can’t do with the land.
4. Negotiating Easement Terms
In some cases, it may be possible to negotiate the terms of an easement. Your conveyancer can help with these negotiations, working to make sure the terms are fair and don’t negatively impact your property.
5. Ensuring Proper Disclosure
In Victoria, sellers must provide a Section 32 Statement (also called a Vendor’s Statement), which includes details of any easements on the property. A conveyancer will make sure this disclosure is complete and accurate, protecting both buyers and sellers from future legal problems.
Confused About Easements? Talk to the Experts at Settled
If you’re unsure how an easement might affect your property, talk to the experts at Settled. Our conveyancers can help you understand the impact and guide you through the process, making sure you are your property are protected. Contact Settled today to get started.
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