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Cross Lease Titles - Potential Issues

17 June 2024

AUTHOR:Mark Hatten

Cross lease is an historic form of property ownership which has many issues.

A cross lease title means you share ownership of the land with owners of the other flats or units, and you lease the flats from each other. If you think this sounds complicated then you are right!

Potential issues are: unclear definition of exclusive use and common areas; obtaining permissions from other owners; and keeping the plan of the titles up-to-date.

Any changes to the external shape of cross lease buildings should be approved by all flat owners first, and the title updated to match the changes – this requires a council resource consent, a surveyor, and a solicitor. Updating the title can take time and be expensive.

If the title is not updated, then it is likely at the time of sale, potential purchasers will consider the title defective and require it is updated – if you haven’t got the other flat owners’ permissions, then the sale of your property could be in jeopardy!

The most common and standard form of title is fee simple (freehold). This does not have the above issues, and is a more robust form of title. Our Survey team are often called upon to assist with changes to crosslease lease areas or the conversion of crosslease titles to freehold titles. For more information on these issues give our team a call.