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Glossary and references

Glossary

Charitable trust

A charitable trust differs from other trusts in that it does not have particular beneficiaries but instead is for a particular purpose. A charitable trust must have one of four basic purposes:

  • relief of poverty
  • advancement of education
  • advancement of religion
  • some other purpose that is of benefit to the community.

Charitable trusts are public in nature. A dwelling transferred into a charitable trust is not owned by an individual and is considered a non-private dwelling. Tenure of household information is generally only collected for households living in private dwellings.

Company share title

A company share title is a form of property ownership represented by owning shares in a company that owns a property, but does not represent direct ownership of the property itself. Company share ownership normally provides a licence to occupy the subject property.

Composite leasehold

The formal name for a cross lease is a 'composite leasehold' and 'share title'. In a common example, two flats on one section, each title comprises a leasehold of one flat and an undivided share of the freehold section that both flats occupy. A consequence of this is a requirement to obtain your neighbours consent if you wish to alter or extend your flat, as you will be doing so on land that your neighbours own a half-share in.

Education trust

An education trust is a way of putting aside money for a young person's future. An education trust helps to ensure that there is enough money available for schooling, tertiary education, other training, and related expenses such as living costs. Education trusts are private in nature. It is very unlikely that a dwelling would be put into an education trust.

Family trust

A family trust is a legal way to protect the assets of an individual and/or family, and hold them for the future. The assets are put into the control of nominated trustees, who may or may not be family members, with the aim of preserving them in the interests of nominated beneficiaries, who may be present and/or future family members.

A family trust must have a certainty of purpose, an asset, and a beneficiary. To create a trust, a person (the settlor) gives money or property to another person (the trustee), to be held in trust for the benefit of either the trust's beneficiaries, or a purpose recognised by law. There should be a signed trust deed (agreement) that acknowledges the settlement, but it is possible to establish a trust verbally. The trustee holds the trust's property in trust for the beneficiary, and administers or manages the trust. A trustee includes an executor or administrator of an estate, which may be the Public Trustee or the Māori Trustee. Companies may also act as trustees.

If the dwelling is held in a family trust, then the dwelling is an asset of that trust.

Funeral trust

Funeral trusts are set up to cover funeral expenses. They are typically started with a few thousand dollars and then regular contributions are made into them. Funeral trusts are private in nature. It is very unlikely that a dwelling would be put into a funeral trust.

Household

One person who usually resides alone, or two or more people who usually reside together and share facilities (such as eating facilities, cooking facilities, bathroom and toilet facilities, a living area).

Inheritance trust

An inheritance trust can help you protect a child's inheritance for the future. An inheritance trust allows a person to keep their assets in their own name during their lifetime, then after death ensures a trust structure will be put in place to protect family interests. Inheritance trusts sit empty (but hold the intent) until death and then they transfer to family trusts for the beneficiaries. Inheritance trusts are private in nature. A dwelling is not held in an inheritance trust, it is still owned by the individual until death, then the trust activates and ownership transfers to a family trust.

Leasehold

Property held under a lease that is a contract where the owner of the property grants another person exclusive possession of the property for an agreed period.

Licence to occupy

A licence to occupy lets you live in the dwelling and use the land but you don’t own the dwelling or the land. Most retirement villages operate this way, and some apartment buildings are starting to operate in this way. The value of the licence to occupy is usually similar to the actual value of the dwelling/unit. The licence to occupy can be used as proxy for ownership and used as a means for getting a mortgage.

Occupied dwelling

A dwelling is defined for the Census of Population and Dwellings 'Census' use, as occupied if it is:

  • occupied at midnight on census night, or the night of the data collection; or
  • occupied at any time during the 12 hours following midnight on census night, or the night of the data collection, unless the occupant(s) completed a questionnaire at another dwelling during this period.

Note: This includes occupied dilapidated dwellings and occupied dwellings under construction.

Occupied dwelling type

A dwelling means any building or structure, or part thereof, that is used (or intended to be used) for the purpose of human habitation. It can be of a permanent or temporary nature and includes structures such as houses, motels, hotels, prisons, motor homes, huts, and tents. There can be more than one dwelling within a building, such as an apartment building in which each apartment or unit is considered to be a separate dwelling.

Dwellings are defined as either private or non-private if they are occupied.

A private dwelling accommodates a person or a group of people. It is not generally available for public use. The main purpose of a private dwelling is as a place of habitation, and it is usually built (or converted) to function as a self-contained housing unit.

A non-private dwelling provides short or long-term communal or transitory type accommodation. Non-private dwellings are generally available to the public for reasons of employment, study, special need, legal requirement or recreation.

Mortgage

An interest in property created as a form of security for a loan or payment of a debt and terminated on payment of the loan or debt.

Private trust

A private trust is not a type of trust, rather it refers to the nature or level of access the public may have to the details of the trust. Examples of trusts that are private include: family trusts, education trusts, funeral trusts, and inheritance trusts. Examples of trusts that are not private in nature include charitable trusts and community trusts.

Rent-to-buy

Rent-to-buy schemes are also known as 'rent-to-own', 'lease-to-own', or 'lease-purchase'.

Rent-to-buy schemes may have some or all of the following characteristics:

  • A conditional sale and purchase agreement between the creditor and purchaser.
  • The purchase price is usually fixed in the agreement.
  • The purchaser pays a deposit and takes possession of the property.
  • The purchaser makes regular payments to the creditor. A portion of that amount is deemed to be rent and a proportion is deducted from the purchase price of the property.
  • The creditor pays the rates and insurance.
  • At the end of the lease the purchaser receives a percentage of the increased property value as a lump sum cash payment (can be called free equity).
  • The lump sum can be used to purchase the property, usually at a rate stated in the original contract.
  • The contract states that if the purchaser is unable to complete the purchase a penalty interest on the amount outstanding may be applied.
  • If the contract is cancelled the creditor may retain all amounts paid under the contract by the purchaser.
  • Title to the property usually remains in the name of the creditor or a related entity until all payments have been made.

Residents do not own or partly own their dwelling under a rent-to-buy scheme. The main reason a rent-to buy agreement does not constitute ownership is because the purchaser assumes no risk on the dwelling and can withdraw, or decide not to buy the dwelling, at any stage. Also, title to the property usually remains in the name of the creditor or a related entity until all payments have been made.

Reverse mortgages

A reverse mortgage is a loan against the equity in a home. The loan and its accumulated interest is repaid when the person dies or the home is sold. Respondents with reverse mortgages should be directed to answer the tenure questions as an owner, who does not make mortgage payments.

Shared equity

Shared equity is where ownership and the capital value of the asset are shared between two or more parties. Shared equity is a form of home ownership assistance. In general, it works by providing home buyers on modest incomes with the difference between the maximum amount they can borrow and the amount they need to buy a house in the region where they live.

Shared equity reduces the size of the mortgage on which the buyer has to make regular repayments by taking a share of the value of the property as equity. The remaining portion is borrowed from the lender and the home owner repays it over time.

Shared equity does not reduce the overall purchase price of a house. It reduces the size of the interest bearing mortgage on which the buyer has to make regular repayments by taking a share of the value of the property. The share is secured through a second mortgage and has no interest costs. When the home is sold the equity share is repaid as a percentage share of the sale price.

Sweat equity

A sweat equity scheme is where the owner works on building their own home. This labour content becomes part of the value of the dwelling.

Unit title

Other names for unit title are 'stratum estate', 'strata title', or 'stratum title'.

A unit title development (such as an apartment block) consists of:

  • Two or more principal units (to be used as a residence or business).
  • The accessory units to be attached to the principal units (such as a garden, garage, pool, or car parking space).
  • Any common property (that is, common spaces such as lawns and driveways, and common facilities such as lifts and laundries).

As a form of ownership, unit title is similar to other property in that it can be bought and sold, leased or mortgaged. But unlike other forms of title, it is made up of three components:

  • Ownership in the particular unit.
  • An undivided share in the ownership of the common property.
  • An undivided share in the ownership of the units if the unit plan is cancelled.

Usual residence

Usual residence is the address of the dwelling where a person considers himself or herself to usually reside, except in the specific cases listed in the guidelines (see the 'usual residence' standard).

Residual Categories

Don’t Know

Use of this category is discretionary. The use of a category capturing don't know responses is most applicable to household surveys where don't know may be a legitimate response to certain questions.

Refused to Answer

This category is only used when it is known that the respondent has purposefully chosen not to respond to the question. Use of this residual category in processing is optional. Its use is most applicable in face-to-face or telephone interviews, but may be used in self-completed questionnaires if the respondent has clearly indicated they refuse or object to answering the question.

Repeated Value

Use of this category is discretionary. It is only used for questions that allow multiple responses. It is used when a respondent has given two responses that have the same code. This may be two written responses, or one tick box response and one written response. For example, someone may tick the English language tick box response option and also write 'English' in the blank space.

Response Unidentifiable

This category is used when there is a response given, but:

  1. the response is illegible, or
  2. it is unclear what the meaning or intent of the response is – this most commonly occurs when the response being classified contains insufficient detail, is ambiguous or is vagueague, or
  3. the response is contradictory, for example, both the yes and no tick boxes have been ticked, or
  4. the response is clear and seemingly within the scope of the classification, but can not be coded because no suitable option (particularly other residual category options such as 'not elsewhere classified' or 'not further defined') exists in the classification or codefile.
Response Outside Scope

This category is used for responses that are positively identified (that is, the meaning and the intent are clear) but which clearly fall outside the scope of the classification/topic as defined in the standard.

Not Stated

This category is only used where a respondent has not given any response to the question asked, that is, it is solely for non-response.

References

Housing New Zealand Corporation (2005), New Zealand Housing Strategy.

Law Commission (1998). Preliminary Paper 34, Retirement Villages, A Discussion Paper, Wellington.

Oxford University Press (1983). A Concise Dictionary of Law, New York.

Statistics New Zealand (1997). Census 96 Housing, Wellington.

Statistics New Zealand (1998). Consumer Expenditure 97, Wellington.

United Nations (2008). Principles and Recommendations for Population and Housing Census Revision 2, New York. Accessed from

http://unstats.un.org/unsd/Demographic/sources/census/docs/P&R_Rev2.pdf.

http://www.aorata.com/glossary/l.ASP

http://www.brokerchat.org.nz/help/glossary/company-share-title

http://www.comcom.govt.nz/ConsumerCredit/renttobuyschemescommissionurgesind.aspx

http://www.netlaw.co.nz/civil.cfm

http://www.publictrust.co.nz/personal_services/trusts

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