PPOR on a cross lease section...

[Josko]

Hi PropertyTalk land,

I am looking at buying a PPOR on a cross lease section. Can anyone let me know if there is anything that I need to look out for, I would like to turn the section into freehold unit title, has anyone done this, and what sort of issues do I need to think about.

Any suggestions and opinions welcomed.

Cheers,

[xris]

Check the flat plan meticulously to see if it corresponds exactly with what is on the site. Minor variations when you buy can turn into major problems later.

xris

[Josko]

Thanks xris, will do.

[xris]

Following on, an example problem might be an aluminium window that protrudes a few centimetres further out than the old wooden framed window (such as with the creation of a small internal window shelf, or perhaps worse still a small bay aluminium window.)

Trivial though it may be this may create a variation to the flat plan and unless it had been dealt with correctly when the window was installed then in the hands of a zealous lawyer all sorts of mayhem will ensue.

I know of a sale falling over because of a clothes line. It was held in place by concrete in the ground but was not on the flat plan.

And people wonder why fee simple is better than crosslease!

xris

[Julian]

You will require the willing co-operation of the other leasee, who should pay half of the costs. You may have to factor in reserve contribution. Allow up to a year. Look at the implications if one party wants to sell mid-way through the process.
Julian

[charlotte30]

Check with a surveyor and or the council to see if it complies with today's subdivision rules. Cross leases had different rules to subdivisions.

Charlotte 30

[Glen]

Sorry for the ignorance, but what are the advantages in changing this property back, considering the expense and hassle.
Will it not preform ok as it is?
Just curious as one of ours is on a cross-lease and i thought i might be missing something here.
Thanks
Glen.

[Josko]

xris are you referring to the plan that comes with the title as the flat plan?

Thanks Julian.

If I am looking to extend the building by another 2 bedrooms, living areas and kitchen, with this in mind would it be better for the section to be fee simple as I believe if I have to go to the other owner every time I am looking to do something to the building, not all the extensions would be done at once.

Glen, the section I believe was a full 1000m2 and later rather then subdividing it was made cross lease so I don’t think it is going back, it is going one step further as in the old days from what I read cross lease was a cheaper alternative to subdividing.

I just want control over my piece of land, that is what freehold (fee simple) title would give me.

[Glen]

Fair enough.
I guess it would give a better resale value later on too.
Good luck!

[xris]

xris are you referring to the plan that comes with the title as the flat plan?

That's the one.

[Volatile]

I am going through this at the moment, anyone know approx how much it costs to end the cross lease and subdivide. How much of a process is it?

[tim360]

Josko did you purchase this property in the end? Just wondering as we're currently looking at a cross lease PPOR.

[Baron Silas Greenback]

We bought a cross lease house a few years ago, and then 3 years ago the other half of the cross lease came up for sale, so we bought that as well. Are going to look at changing it to subdivided in a little bit. I am assuming it will be an expensive process.

But at least we are always guaranteed approval to floor plan changes (assuming passes normal council rules)

[xris]

We bought a cross lease house a few years ago, and then 3 years ago the other half of the cross lease came up for sale, so we bought that as well. Are going to look at changing it to subdivided in a little bit. I am assuming it will be an expensive process.

But at least we are always guaranteed approval to floor plan changes (assuming passes normal council rules)

So why bother changing?

[Baron Silas Greenback]

We wont if we renovate and sell. But both houses have loads of potential for extensions, so any potential buyers would be wary of a cross leases impact on extension plans if we sell them unrenovated.

We dont know the costs involved in sub dividing yet, so no def plans.