What is the purpose of a caveat in land ownership?

The primary purpose of a caveat in land ownership is to notify parties of a specific interest in the land. A caveat acts as a formal notice registered on the title of a property, indicating that someone claims an interest in it and that the property cannot be transferred or otherwise dealt with without acknowledging this interest. This serves to protect the rights of the individual or entity that has the caveat, informing potential buyers or other interested parties that they may need to address this claim before proceeding with any transactions regarding the property.

The other options do not accurately represent the function of a caveat. For instance, while property value can be influenced by various factors, a caveat itself does not inherently increase or decrease value. Similarly, tax exemptions are unrelated to caveats, which serve only to inform about claims on the title rather than financial considerations. Finally, while caveats could potentially affect the speed of property transactions due to the need to clear these interests, this is not a direct function of a caveat; rather, its primary goal is to communicate existing rights regarding the property.