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Crosslease Amendments and conversion to Freehold

13 June 2012

AUTHOR:Kevin Birch

Prior to the commencement of the Resource Management Act, but less common since then, many small lot urban subdivisions were undertaken by way of the creation of crosslease titles. Crosslease titles create a shared ownership of the land in the underlying title and a 999 lease in the buildings shown on the crosslease plan. This form of ownership circumvented the Council requirements to apply for a subdivision consent and was therefore a cheap way to divide land and overcame Council restrictions on minimum lot sizes. For these reasons they were very popular and a number of urban titles still exist under crosslease ownerships.

However crosslease titles have many underlying issues. The lease of the building is defined by the shape of the building that existed when the survey was done and any change to the footprint requires a resurvey and the approval of all other owners of the crosslease title. Crosslease titles also have exclusive use areas (parts of the title intended to be used by the lessee of the dwellings) and common areas (parts of the title intended to be used by the lessees of all of the dwellings). Historically these areas are poorly defined and the characteristics of a crosslease title can also give rise to problems for the owners.

Our Pukekohe Surveyors and our Tauranga Surveyors are often called upon to assist with changes to crosslease lease areas (where the external dimensions of dwellings have been altered) or the conversion of crosslease titles to freehold titles. For more information on these issues give our team a call.