Converting Cross Lease to Freehold: What You Need to Know

Owning a cross lease property in New Zealand comes with unique challenges and restrictions that can complicate renovations and even resale. On top of that, updating the cross lease unit plan is mandatory before making any alterations, adding another layer of legal obligations.

Converting your cross lease property to a freehold title is a smart solution. It gives you complete ownership of your property and can also significantly boost its resale value. 

But how can you make the conversion? This guide has all the answers you need.

Why Convert a Cross Lease Title to Freehold?

A cross lease property is a form of shared ownership where multiple property owners share an undivided interest in the land. These properties are governed by a legal document known as a “flats plan,” which outlines the boundaries and shared areas of the property. This shared ownership of land often leads to disputes over maintenance, usage, and costs, making property management more stressful. 

These limitations can reduce the property’s value and discourage potential buyers.

Converting a cross lease title to a freehold title eliminates the hassles and frustrations of being in a shared ownership. It provides significant benefits, such as:

• Full Ownership: With a freehold title, you own both the land and the building outright, giving you complete control over your property. You no longer need to seek approval from co-owners for external construction, modifications, or additions.
• Higher Property Value: Freehold properties are more appealing to buyers and generally hold higher market value compared to cross lease properties. 
• Simplified Management: You won’t have to deal with shared maintenance responsibilities or common expenses, which can often lead to disagreements. 
• Easier Subdivisions: According to Auckland’s Unitary Plan, you can further subdivide freehold titles to create additional dwellings and allotments without requiring the consent of leaseholders. And, you are permitted to construct up to three storeys on a single dwelling.

How to Convert a Cross Lease Title to Freehold

Converting a cross lease title to a freehold title involves a series of steps to separate shared ownership and grant individual ownership of the land and property. However, the process can be complex and typically takes 5-6 months, depending on council processing times and the subdivision’s complexity.

Here’s an overview of the process:

Discuss with Cross Lease Neighbours: Begin by discussing the proposed conversion with your cross lease co-owners. Since all cross lease properties transition to freehold simultaneously, unanimous agreement is required. This stage may include negotiating cost-sharing arrangements and addressing any concerns from the parties involved. 

Engage a Licensed Cadastral Surveyor: After obtaining agreement from your co-owners, consult with a licensed cadastral surveyor, like Fluker Surveying, to guide you through the technical aspects. The surveyor will conduct a topographical survey to map the property, including all existing structures, boundaries, and shared areas. This survey is essential for creating accurate subdivision plans and identifying new boundary lines that comply with local council regulations.

Subdivision Plan: Next, a subdivision or scheme plan is prepared by land surveyors, outlining the proposed boundaries for each property and any easements required for shared access, utilities, or services. These rights are legally recorded in the new title documents to ensure all parties have access to essential services.

Resource Consent Application: The subdivision plan is then submitted as part of a resource consent application to the local council. This application includes details about how the land will be divided and demonstrates compliance with the Resource Management Act (RMA) and council rules. 

Land Transfer Survey and Council Certification: Once resource consent is approved, a land transfer survey is conducted to mark the new boundaries on the ground. A draft land transfer plan is then submitted to Land Information New Zealand (LINZ) for approval. 

This step also includes applying for Section 223 and 224c certificates from the council to finalise the subdivision process and the land is ready for new titles to be issued. Council processing typically takes about 20 working days.

Legal Assistance for Title Registration: Your legal representative will review the resource consent, survey plan, and cross lease titles to ensure compliance. They will draft new easements if required, liaise with council and service providers, and work with your bank to release any existing mortgages tied to the cross lease title.

Register Freehold Titles with LINZ: Finally, all documentation will be submitted to Land Information New Zealand (LINZ) for approval and registration of the new freehold titles. Once issued, you officially own your property outright.

The Average Cost of Converting a Cross Lease Title to Freehold

The cost of converting a cross lease title to a freehold title in New Zealand varies depending on the complexity of the property and the specific requirements of the conversion. However, as a rough estimate, in Auckland, a 2-lot cross lease conversion typically costs between $38,000 and $40,000, while in Christchurch, it ranges from $20,000 to $22,000. These costs include surveying fees, legal expenses, and council LIMS fees.
If easements or complex boundary adjustments are needed, there may be extra charges for survey and legal work.

Fluker Surveying Can Help with Cross Lease Conversion

If you’re ready to convert your cross lease property to a freehold title, contact Fluker Surveying today. We specialise in converting cross lease properties to freehold titles, offering end-to-end support throughout the process. From surveys and planning to council approvals and title registration, we ensure a smooth and hassle-free experience. 

Call us at  09 427 0003 to schedule an initial meeting.