Freehold land (or fee simple) provides people with the most complete form of ownership of that land, in perpetuity. It allows the land holder to deal with the land including selling, leasing, licensing or mortgaging the land, subject to compliance with applicable laws such as planning and environment laws. Notwithstanding, ownership of everything associated to the land is not absolute, as the States and Australian Government are empowered to withhold certain rights, such as the right to any minerals or petroleum located on the land.
What does title mean?
Most developed, privately held land in Australia is under freehold tenure. This allows the landowner to have unrestricted ownership of that land and right to deal with that land, subject to complying with applicable laws in each State and Territory.
Native title cannot be claimed on freehold land, as it is extinguished over the area. However, protection is required on freehold land under State and federal legislation for the protection of sacred sites.
Some leases can convert to freehold
In some States, a lease of Crown land may be converted to freehold. This may eventuate in a direct conversion to freehold; or as is the case for some leases in Queensland, an interim tenure (freeholding lease) is issued. These freeholding leases offer the lessee the opportunity to pay the purchase price for their lease in instalments over a number of years - similar to paying a mortgage. Upon the final instalment, the freeholding lease is converted to freehold.
Freehold land in the Northern Territory
Out of the approximately 1 million square kilometres of land in the Northern Territory, only around 5,000 square kilometres is held as 'freehold'.
Freehold land in the Northern Territory is typically represented by private dwellings in locations closer to the city.
Freehold land in Queensland
About 28% of the total land area in Queensland is freehold land.
It is possible to convert perpetual or term leases to freehold in Queensland. Recent changes to the Land Act 1994 (Qld), introduced on 1 July 2014, have streamlined the costs and process for conversion. Information about the process for conversion is outlined on the Queensland Government website. A number of issues will be considered to assess whether conversion is appropriate. If the application for conversion is accepted, an offer will be issued outlining conditions and a purchase price to complete. Native title issues may need to be addressed as a condition of the application.
In addition, a freeholding lease will convert to freehold on receipt of the final payment.
From 1 January 2015, Aboriginal and Torres Strait Islander communities have the option to convert some of their communal lands to freehold land. The new rules outlined on the Queensland Government website allow Aboriginal and Torres Strait Islander people to own freehold in their own communities and, as owners, to mortgage, lease, run a business or sell their land.
Freehold land in Western Australia
About 8% of the total land area in Western Australia is freehold land. Most freehold land in Western Australia is located in urban areas and in the southern part of the State.