crosslease -> freehold

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Jaxson

8041 posts

Uber Geek

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#409953 26-Nov-2010 16:12

wellygary: The fact yours are cross leased tend to indicate they don't satisfy the councils minimum rules on individual sections, (or would require significant legal work to do so)

Yeah that's where I was coming from.

When you subdivide your own property it's easier to bend the rules. Both parties need to agree to having closer boundaries etc, which is easy to agree on if you own the whole lot and actually are the 'both parties'. Negotiating with yourself is so much easier! So yeah, if they could do it easily then they probably would have, which means on such a small lot of land, you will probably find reasons why they didn't.

slartibartfast

61 posts

Master Geek

#409955 26-Nov-2010 16:15

I would really recommend going through with the change to freehold (based on bitter personal experience).

Crosslease is a pain, and can cost you a lot of money.

In a crosslease, the flats plan / site plan needs to exactly match your building as this defines what you actually own. If an extension has been done to your property that alters the plan then under a cross lease you need to get the property re-surveyed and the plan updated.

If you don't, then you have a "defective title" and will not be able to sell your property easily.

Better still, once re-surveyed you then have to get the crosslease itself updated which involves more lawyers, consents etc.

We discovered this ourselves one day before putting our property on the market and had to rush through fixing it all up - re-surveying, resource consent (!), cross lease update. Took 3 months and pushed out settlement etc.

It ended up costing us around $7k I reckon. For around $10k we could have gone freehold (but didn't as it was just to sell the property). Also, when you go freehold you can share some costs with your fellow cross leasers.

So, from my experience I would:
a) be very careful before buying another cross lease property.
b) move it to a freehold title well before I wanted to sell the house.

You should get your money back as others have said.

Regs

4066 posts

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Snowflake

#410037 26-Nov-2010 20:09

chiefie: Not only that. Most cross-lease also share main water inlet pipe, however the sewage outlet and wastewater outlet should be separate - but depends on how it was first built.

why would the water main be shared because it is a crosslease?

its not hard, or even expensive, to install a second meter and run a supply pipe to each property. I cant see why this would be a common thing for a crosslease property...

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NonprayingMantis

6434 posts

Uber Geek

#410059 26-Nov-2010 21:38

slartibartfast: I would really recommend going through with the change to freehold (based on bitter personal experience).

Crosslease is a pain, and can cost you a lot of money.

In a crosslease, the flats plan / site plan needs to exactly match your building as this defines what you actually own. If an extension has been done to your property that alters the plan then under a cross lease you need to get the property re-surveyed and the plan updated.

If you don't, then you have a "defective title" and will not be able to sell your property easily.

.

surely that is the same as if you had a freehold. if your property doesn't match the LIM then you are screwed.

slartibartfast

61 posts

Master Geek

#410486 28-Nov-2010 21:39

NonprayingMantis:
slartibartfast: I would really recommend going through with the change to freehold (based on bitter personal experience).

Crosslease is a pain, and can cost you a lot of money.

In a crosslease, the flats plan / site plan needs to exactly match your building as this defines what you actually own. If an extension has been done to your property that alters the plan then under a cross lease you need to get the property re-surveyed and the plan updated.

If you don't, then you have a "defective title" and will not be able to sell your property easily.

.

surely that is the same as if you had a freehold. if your property doesn't match the LIM then you are screwed.

Apparently not quite the same.

You're right - if you do alterations without consent then you're in a world of pain on the LIM.

The big difference is that on a freehold property I believe you don't need to get your property re-surveyed if you do an extension. The plans provided with your consent are usually sufficient (probably depends on the extent of the change).

With a crosslease, due to the legal nature of what you own being a share in the land and the buildings defined in the site plan - you must get the land re-surveyed. This then also requires you to get the cross lease documents updated. Otherwise you do not technically own the extension - and therefore aren't legally selling it to the buyer.

So, say if you add a garage to your freehold property then all you might need is a resource consent.

For a crosslease property you need the consent + a resurvey + a crosslease update + a LINZ title update.

I'm not a lawyer or a planner, but it's clear from my epxerience that freehold saves you a world of legal pain.

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