People created a cross lease as a low-cost way of having more than one house on a piece of land. The land won’t be fully subdivided and instead all house owners jointly own the land. Typically, they have areas allocated to them for their exclusive use.
What’s different about a cross lease?
What’s different about a cross lease is that because both house owners own the whole land, they lease their houses from each other. That is why when you read the title, the houses are called Flats (sometimes Areas) and the title will refer to leases.
A cross lease is essentially a historical form of development that was extremely popular in the 1970s and 80s, as it avoided the subdivision rules and restrictions of the day.
Are there any issues with cross leases?
All house owners own the whole of the land, if one house wants to make alterations they must ask permission of the other owners. A cross lease is also generally created with shared driveways and shared services.
A cross lease is a cheaper way of subdividing, and people have to share the land. Cross lease properties are generally of lower value when it comes time to sell the house.
Can you convert a cross lease to a freehold?
You can convert your cross lease property to a freehold title through a simple subdivision. This can add potentially significant value to your property and avoid the pitfalls of cross lease.
The conversion will require:
- A survey of the property to mark out the new property boundaries
- A survey of the location of all services and a plan of how these services will be separated
- A subdivision consent application to be prepared and lodged
- Physical works to separate the services and potentially upgrade the driveway
- An application to Land Information New Zealand for new property titles
Thomas Consultants can give you advice and help you with converting your cross lease property to freehold. Please contact us today to get the process started.