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Before diving into the details, it’s important to understand that in the context of property in Karachi or anywhere in Pakistan, the term “lease” signifies that your property is officially registered with the government, indicating that you are the recognized owner of that specific land according to government records. The lease documents typically refer to an agreement, commitment, undertaking, or rent between any two parties. When dealing with private societies or builders, it’s vital to inquire whether this is the one that’s officially authenticated by the government department called the Board of Revenue (B.O.R). If it is, then you can proceed with confidence.
Lease Documents (also referred to as Form 2)
Lease documents typically pertain to the primary land, serving as a legal agreement between an individual and the government department responsible for land registration, such as the Board of Revenue (B.O.R). For instance, if you’re embarking on establishing your own residential society and have acquired a 5-acre plot, you would obtain 99-year lease documents for the entire 5-acre land from the Board of Revenue B.O.R. This validates your rights to the land and ensures its legal status.
In essence, it serves as a legal document that signifies one’s rights and privileges concerning land or property, whether granted by a government authority or agreed upon between private parties. Understanding the distinction is crucial, especially when dealing with real estate ventures and property development.
Remember
A lease documents can be obtained if you purchase the land/property directly from the government.
Do lease documents mean rent documents?
Usually, it can be thought of as a form of long-term rent. In this context, it means that the government is effectively renting the land to you for a period of 99 years. At the end of this 99-year term, ownership typically reverts back to the government. However, the government typically offers the opportunity to renew the lease documents by paying certain fees and charges. I hope this clarifies things for you.
Sub-Lease Documents
Let’s take the same above-given example, where you’ve established your society on a 5-acre land and now you have divided it into 100 individual plots for sale, the concept plays a crucial role. Initially, you secure the mainland by taking lease documents for the entire 5 acres from the government department, such as the Board of Revenue (B.O.R). This registers you as the owner of the mainland in government records.
Now, as you proceed to sell these 100 plots to your clients, you provide each plot buyer with a separate document known as “sub-lease documents.” That grants the buyer ownership rights to their specific plot within your society. Essentially, it extends the rights and responsibilities of each plot-holder, ensuring their ownership is officially recognized by the government. It is also obtained for 99 years and the individual plot owner/purchaser is called the lessee, and the society builder/seller is called the lessor in terms of paper.
This process ensures that not only is the mainland, but each plot within it, is also properly documented making the ownership of your clients officially recognized by the government. This distinction is essential in property transactions and offers legal protection to both the plot owner/purchaser and the society builder.
Both the society builder and individual plot owners/purchasers follow a specific process for registering their plots. This process involves visiting government-appointed registrars, typically assigned based on specific areas within the city. While the main land’s registration with the Board of Revenue (B.O.R) is essential, the registration of individual plots is carried out at the registrar’s office or the Deputy Commissioner’s office (D.C Office). This step ensures that each plot is officially recognized by the government, further highlighting it. These registrations play a vital role in the real estate sector, providing legal legitimacy to property ownership.
It represents the legal framework through which property ownership is established and recognized by the authorities, ensuring that property transactions are conducted in accordance with the law and government regulations.
Remember
A sub-lease is the document if you purchase the property/land from the leaseholder, though the government (government nominated registrar) is a witness between both of you for registering the documents.
Transfer Property or Non-Sub-Lease Property
If you’re a society builder you have a choice when selling plots. Instead of offering sub-lease documents to your buyers, you can give them full ownership of the plots on your company’s letterhead they purchased. This means they become the rightful owners. It’s a simpler process where they own the land outright. This process is commonly referred to as transferring the plot, often locally known as a “transfer plot” or “non-sub-lease plot. (Learn How to buy and transfer non-sub-lease property)”.
Light Easy Example
Imagine you purchased a block of butter from the store. Now, you own the entire block. If I approach you and you decide to sell me a quarter of that butter, you’re essentially granting me a portion of your ownership. In this scenario, your ownership of the entire butter block represents the lease, and the portion you sold constitutes a sub-lease or sub-ownership.
Now after selling a quarter of the butter, it’s entirely up to me how I choose to consume a quarter of my butter or save it for later. Now, let’s explore the concept of “non-sub-lease” with a fresh example:
Imagine I come to you, and you agree to sell me a quarter of the butter. However, here’s the catch: you insist that I can only eat butter from your plate, and you retain the main ownership of the entire block. In this situation, I have purchased a portion, but I haven’t gained complete control. You still hold the primary ownership. This arrangement exemplifies the idea of “non-sub-lease.”
Hope now there wouldn’t be any more confusion between all of the above three. 🙂
