Introduced in the late 1960s, cross lease arrangements allowed developers to circumvent strict subdivision regulations, saving them both time and money. However, the RMA 1991 and the Auckland Unitary Plan have effectively made cross leases obsolete. Despite this, Auckland property owners continue to face ongoing issues associated with cross-lease agreements. This leads many to convert their cross-lease to freehold titles.
Subdivision specialist Troy Patchett of Subdivide Simplified, has assisted numerous Auckland residents with property subdivision. He has noted a growing demand for cross-lease to freehold conversion services, particularly among those looking to put their property on the market.
“A freehold property is much more appealing to potential buyers, and with the market slowing down, sellers are eager to make their property as appealing as possible,” says Patchett. “Removing the limitation of a cross lease is an effective method to achieve this.”
In addition to being a more enticing prospect for buyers, sellers may also enjoy a 7-20% increase in property value when switching their property to fee simple.
In a cross-lease arrangement, all property owners have shared ownership of the land, and each individual leases both the land and dwelling from the other owners for a set term, usually 999 years. However, one drawback of cross-lease arrangements is that any modifications to the home necessitate the consent of all involved parties. Additionally, some cross-lease arrangements may contain additional provisions, such as animal ownership and restrictions around exterior decorating and gardens.
“Many people want full say over their land,” Patchett says. “Switching your property from a cross-lease to fee simple offers this.”
Subdivide Simplified helps Auckland residents navigate the often-challenging subdivision process. The company assembles all of the necessary documents and reports, surveys and makes an application to the Auckland council.
“The process can be overwhelming, and our clients appreciate having someone on their side who knows exactly what is required for a seamless subdivision process.”
Media Release on 2 March 2023
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Subdivide Simplified
info@subdividesimplified.co.nz
027 511 9442
https://www.subdividesimplified.co.nz/