What is a Joint Property?

Purchasing a lot as an undivided property is a concept that often generates confusion among buyers, especially when compared to purchasing a lot as a freehold. To understand the differences, it's crucial to break down both scenarios.

Full Ownership

When a developer acquires land to develop a real estate project, he typically purchases land with a independent real estate registration and one writing of 100% of the land. Once you meet the legal and planning requirements, such as those established in the Land Use Schemes (EOT) or Land Use Plans (POT), you are authorized to subdivide the land. This subdivision allows you to divide the land into multiple lots—for example, 50 lots—and each of these lots will have its own property registration and separate title deed. This means that when you purchase one of these lots, you are the exclusive owner of that specific piece of land, with all the legal rights that entails.

The Undivided Lot

However, in the case of a jointly held lot, the situation is different. When a developer fails to obtain authorization to subdivide the land because it doesn't meet regulatory requirements, they cannot sell lots with a separate registration or a 100% deed. Instead, they sell percentages of the total area of the land.

In this scenario, the land has a single deed that encompasses the entire project, and all buyers acquire a percentage of that master deed. In other words, the developer remains the overall owner of the project, but each buyer acquires a stake in the entire land. Although they may symbolically be assigned a specific lot (such as Lot 1, 4, or 5), from a legal perspective, what they actually own is a percentage of the total land area.

Implications of Joint Ownership

Purchasing a lot in undivided ownership entails several implications. Since the lot isn't registered independently, you don't have the same autonomy you would have with a full ownership. Any major decision regarding the land, such as selling, mortgaging, or developing, will require the consent of all co-owners who have a stake in the deed.

It is essential that buyers be aware of these differences and understand exactly what acquiring a jointly held lot entails. Although this type of purchase may seem attractive due to its lower initial cost, it can also lead to long-term legal and administrative complications.

In conclusion, acquiring a joint property lot means acquiring a percentage of a piece of land shared with other owners, which differs significantly from purchasing a lot with a separate deed. To avoid surprises, it's essential to understand all the legal aspects before proceeding with this type of investment.

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