Company Title Property Explained: Unique Ownership Insights In Australia

When you buy real estate in Australia, you don’t always receive a title to “your” lot. In some buildings - often older blocks in inner-city suburbs - the land and building are owned by a company, and you buy shares in that company linked to the right to occupy a specific unit. This is known as company title property.

If you’re weighing up a purchase or sale, or you’re already a director or shareholder in a company title building, it’s important to understand how this structure works, how it differs from strata, and the key legal documents that keep everything running smoothly. In this guide, we break down company title property in plain English so you can make confident decisions.

What Is Company Title Property?

Company title is a form of property ownership where a company holds legal title to the land and building. Individual buyers don’t receive a freehold title to a lot. Instead, they buy shares in the company that confer a contractual right to occupy a particular flat or car space and use the common areas.

In practice, your “ownership” is a bundle of rights set out in the company’s governing rules, not a lot on a deposited plan. Those rights are usually documented through a share certificate plus an occupancy right (for example, a licence or lease) tied to your shares. The specific arrangement varies building to building.

Company title is more common in older residential buildings (particularly in NSW and VIC) and occasionally appears in mixed-use or boutique commercial buildings. Many such buildings pre-date the widespread adoption of strata title, and some have remained on company title by choice.

How Does Company Title Work In Australia?

Unlike strata title - which is governed by state legislation tailored to community living - company title is primarily governed by corporate law and the company’s internal rules. This is why careful due diligence is essential before you buy.

Who Owns What?

• The company is the registered owner of the land and the whole building.
• You, as a buyer, acquire shares in the company that carry the right to exclusive occupation of a specified unit and shared use of common areas.
• Your rights and obligations are set out in the company’s Company Constitution and any house rules, by-laws or occupancy agreements the company has adopted.

Board Control And Day-To-Day Management

The board of directors manages the building. They enforce the house rules, approve repairs and upgrades, oversee budgets and levies, and often control who can buy shares (and therefore who can live in the building). These powers come from the corporate governance framework rather than strata law.

Directors make decisions according to the Corporations Act 2001 (Cth) and the constitution. Contracting authority can also be granted to officers or agents under Section 126, and documents may be executed by the company using section 127 formalities.

Finance And Lender Considerations

Because you’re purchasing shares rather than a freehold lot, lending policies can differ. Some lenders are cautious with company title, which can affect borrowing capacity and resale demand. It’s wise to speak with your financier early so there are no surprises.

State-Based Nuances You Should Know

Each state and territory has its own property and duty (stamp duty) settings that can apply to share transfers in landholding companies. In some jurisdictions, “landholder duty” may be payable when you acquire a significant interest in a company that owns land over certain thresholds. Approvals, documents and processes can also differ from building to building because they’re driven by the constitution - there isn’t a uniform company title statute like there is for strata. Getting local legal and tax advice is essential.

Company Title vs Strata Title: What’s The Difference?

Both structures facilitate multi-occupancy living, but they operate very differently.

Ownership And Legal Framework

• Company Title: You own shares in a company. Your right to occupy a unit comes from the company’s rules and your shareholding. Governance sits under the Corporations Act and the constitution, not strata law.
• Strata Title: You own a freehold lot (title) plus an interest in common property managed by an owners corporation/body corporate under state strata legislation.

Approvals And Transfers

• Company Title: The constitution often requires board approval for any transfer of shares. There may be pre-emptive rights, owner-occupier requirements, or restrictions on leasing.
• Strata Title: A standard conveyance of the lot; a strata committee cannot usually veto a sale to a willing buyer (though by-laws still apply to conduct and renovations).

Governance And Decision-Making

• Company Title: Company directors have broad powers, and shareholder votes are based on shareholdings and rules in the constitution. Disputes follow corporate processes (meetings, resolutions, or court).
• Strata Title: Owners corporation decisions are made under strata legislation with established procedures and tribunal pathways for disputes.

Pros And Cons Of Company Title

• Potential Benefits: Constitutions can be tailored to building preferences (for example, owner-occupier character, renovation standards, quiet enjoyment). Smaller communities may benefit from bespoke rules and close oversight.
• Potential Drawbacks: Board approval requirements can slow down sales or leasing; borrowing can be harder; and governance depends heavily on the quality of the constitution and the board’s competence.

In short, strata is more standardised and familiar to banks and buyers, while company title is more bespoke and relies on corporate governance working well in practice.

Buying Or Selling A Company Title Property: Due Diligence Essentials

The process looks different from a standard strata purchase. You’re not just buying a “unit” - you’re buying into a business structure that owns the building. Strong due diligence will save headaches later.

Key Documents To Review Before You Buy

• Constitution and House Rules: Understand rights to occupy, transfer restrictions, renovation approvals, pet policies, parking rules, levies and meeting procedures. The Company Constitution is the backbone of your rights.
• Share Schedule and Certificates: Confirm the shares linked to the unit you want, any encumbrances, and whether certificates are in order.
• Occupancy Agreement: Check any licence/lease to occupy the unit. Look at term, obligations, and how it interacts with the constitution.
• Financials: Review budgets, levies, arrears, insurance policies, maintenance plans and sinking fund status.
• Board Minutes and Resolutions: Scan for recurring issues (water ingress, structural works, disputes) and understand upcoming capital works.
• Approvals And Consents: Identify board approval pathways for your purchase, future leasing, or renovations. Understand timing and criteria.

Share Transfers And Settlement Mechanics

Practically, your conveyancer will focus on a valid share transfer, proper execution and company register updates, rather than a standard land transfer for a lot. It helps to understand the steps to follow in How to Transfer Shares and any ASIC forms or company register changes that can arise in an ASIC transfer of shares context.

Be aware of pre-emptive rights, share valuation mechanisms, and consent requirements built into the constitution. These can influence timing and whether a sale can proceed.

Lending, Insurance And Tax

• Lending: Confirm early whether your lender supports company title security and any extra conditions (for example, minimum deposit or different LVR).
• Insurance: Ensure the building policy is current and adequate. Clarify who insures contents and improvements inside your unit.
• Duty and Tax: Share transfers in landholding companies can attract duty in some states based on thresholds and percentages. Get advice on local requirements and your income tax position.

Selling A Company Title Interest

Vendors should prepare well in advance: have current financials, minutes and certificates ready, and understand approval steps so you can set realistic timeframes. You’ll also want to brief agents on the structure, restrictions and benefits so buyers receive clear information.

Governance, Disputes And Compliance: Key Legal Points

Because company title sits in corporate law, getting governance right is critical for building harmony and asset value. Good processes also reduce the risk of disputes.

Directors’ Duties And Meeting Procedures

Directors must act in the best interests of the company, exercise care and diligence, and avoid improper use of position or information. Decisions should be properly documented with board or members’ resolutions. If you’re documenting decisions between meetings or formalising approvals, a practical tool is a Directors’ Resolution recorded consistently with your constitution and the Corporations Act. Many boards rely on a clear, standard format similar to a Directors’ Resolution Template to keep records tidy.

Contracts And Building Works

Buildings inevitably need repairs and upgrades. The board (or authorised officers) can sign contracts on the company’s behalf under the authority granted in the constitution or via Section 126. For formal execution by the company, you can rely on section 127 where appropriate. Clear scopes of work and properly negotiated terms with suppliers and contractors will help manage risk and budget.

House Rules And Enforcement

Because the constitution is the primary rulebook, make sure house rules are clear, updated, and consistently enforced. Common areas, noise, pets, short-stays and renovations should all be addressed. Consistency reduces friction and protects the amenity and value of everyone’s investment.

Shareholder Relations And Private Agreements

In addition to the constitution, some company title buildings adopt a private Shareholders Agreement between owners. This can set expectations around transfers, funding, dispute resolution, and director appointments. While not mandatory, it’s a useful layer of clarity - particularly in small buildings where relationships matter.

Resolving Disputes

Disagreements can arise around repairs, levies, transfers or renovations. The constitution should outline processes for meetings, voting and disputes. Many issues can be resolved by negotiation or mediation. Where you reach a commercial resolution, documenting it in a binding Deed of Settlement helps close the loop and prevent further conflict.

For persistent governance problems (for example, repeated refusal to approve reasonable transfers contrary to the constitution), members may consider remedies available under corporate law. This is fact-specific, so it’s best to get tailored advice early.

Compliance Hygiene

• Maintain an up-to-date company register and accurate share records linked to units.
• Keep minutes, financial statements, insurance certificates and levy notices in good order.
• Ensure repair and maintenance decisions are properly authorised and documented.
• Review the constitution periodically to address gaps or outdated rules (for example, short-term letting or EV charging).

Practical Tips For Buyers, Owners And Directors

Whether you’re entering a company title building or helping to run one, these practical steps can make a big difference.

For Buyers

• Confirm the exact shares you’re buying and the unit they correlate with, and check there are no undisclosed encumbrances.
• Read the constitution and house rules closely - focus on transfer approvals, renovation rules, leasing and levies.
• Ask for board minutes, budgets and recent capital works plans to gauge future costs.
• Discuss finance with your lender up front and plan for any additional conditions.
• Understand the share transfer process, approvals, and timing so your contract dates are realistic. The guides on How to Transfer Shares and ASIC transfer of shares can help you map the steps.

For Current Owners

• Keep your share certificate and occupancy documentation safe and current.
• Budget for levies and capital works, and attend meetings to stay informed.
• If planning renovations, check approval pathways and obtain written consent before works commence.
• If leasing is allowed, ensure tenant obligations align with the house rules and your occupancy rights.

For Directors And Boards

• Review and modernise the constitution where it’s unclear or outdated, with member approval where required.
• Document decisions with clear board or member resolutions and keep records tidy, using consistent formats like a Directors’ Resolution Template.
• Standardise processes for transfers, renovations and by-law enforcement to promote fairness and transparency.
• Engage professional advisors for significant capital works, insurance reviews, or complex disputes.

Key Takeaways

• Company title is a corporate ownership model: you buy shares in a company that owns the land and building, and those shares carry the right to occupy a specific unit.
• Your rights and obligations come from the corporate framework and the building’s rulebook - the Company Constitution - not strata legislation.
• Board approval, pre-emptive rights and house rules commonly control transfers, leasing and renovations, so due diligence is critical before you buy or sell.
• The mechanics of buying and selling focus on share transfers and company records; understanding How to Transfer Shares and any related ASIC transfer of shares steps will smooth settlement.
• Good governance - clear resolutions, compliant execution under Section 126 and section 127, and practical house rules - underpins building harmony and value.
• Some buildings benefit from a supplementary Shareholders Agreement and, where disputes arise, a documented outcome via a Deed of Settlement.

If you would like a consultation on company title property, you can reach us at 1800 730 617 or team@sprintlaw.com.au for a free, no-obligations chat.