Cross Lease Conversions
Under a cross lease title, you share the land with other owners—all of whom share an equal portion—while enjoying exclusive use of a flat or building which is leased from the other owners. The exclusive use areas may include buildings or other areas set out on the cross lease flat plans. Common areas (such as driveways) are held in equal ownership.
What is a Cross Lease Conversion?
A cross lease conversion is the changing of a cross lease title to fee simple title. This has the advantage of granting you sole ownership of your property, and the rights to use that land as you like. For many, this makes it much easier to understand their property rights and typically increases the value of the land.
How we help
KW consultants provide a seamless cross lease conversion process. We will help you understand what is involved, remove as much complexity as possible – while keeping you updated each step of the way.
Our experience gained over the years allows us to proactively create efficiencies in this process, thereby reducing the time and costs wherever possible.
The Process
Feasibility
We survey your property and look into the drainage arrangement, then present these findings to you. From there, we can provide an update on any additional services and construction that may be required.
Application
The resource consent application and assessment of environmental effects are prepared, along with the infrastructure report and concept drawings. We then lodge these with the council for you.
Engineering Approval
We will complete the design of any engineering works that may be required and submit these to council for approval. This may involve other consultants depending on the site requirements.
Construction
The new property boundaries are pegged and any physical works required are completed. We’ll provide assistance with contract administration and project management where needed.
Completion
We make an application to Council for section 223 and 224 certification after all the consent conditions have been met. Once your 224 certificate is issued, the new titles will be released.
Get in touch and consider it done.
Answers to some common questions we get
Cross lease titles were popularised in the 1960s and 70s as a cheaper form of subdivision as they did not require the same council scrutiny as a traditional fee simple subdivision. The reasoning was that this form of land development back then did not constitute a ‘subdivision’, and therefore, developers were able to avoid expensive development contributions they would otherwise need to pay.
Your property title will outline if your property is a cross lease, fee simple or unit title. If you are unsure what type of title your real estate property holds, you can call our team to look into your property and advise you, free of charge.
A Cross Lease flats plan is a legal document drawn up by a Licensed Cadastral Surveyor. The flats plan accurately depicts the leased areas, such as your buildings, exclusive use areas, and areas held in common ownership (such as shared driveways). It is a graphical representation of the interest registered on your title and should be read in conjunction with your title.
As a rule of thumb, cross lease properties generally sell for less than fee simple properties.
Cross Leases can be a trickier form of ownership, particularly if you or the other leaseholders want to develop your site or carry out work on your buildings. All external building works will require written consent from the other leaseholders, including any banks with a registered interest. If permission is not gained from co-leaseholders, this can result in a civil matter and work may be halted. All building amendments also need to be registered on an updated flats plan, adding extra costs to any development. As a less understood form of ownership, this can impact the sales price of your site.
Not at all! Having an equal share in the underlying land means that any development of the site draws on Auckland Unitary Planning rules for building and inaccessible areas to be assessed against the whole site. This often means the construction of a larger building is possible than what you could have on a fee simple title, adding extra value to the property.
Of course, this will have to be signed off by your co-leaseholders – which can be a nuisance. Conversely, this can give you some control over the development of the rest of the property. If the other leaseholders wish to build—blocking your views or impacting on the value of your property in the process—you can restrict these works.
A deficient title occurs when the onsite buildings, decks and exclusive use areas don’t match those on your cross lease flats plan. A deficient title may cause uncertainty for potential buyers, bank lending, and property insurances.