Questions on Cross Lease title.

[m_shah93]

Hi All,

I am very new in the property buying procedure and this is my first time.

Situation: I like one cross lease property, but the title plan is not matching the actual property. it looks like they have added a part in the house. To me the title is defective

I have no experience and don't know how I will confirm this before going to lawyer all I know that I have title, If I am comfortable after satisfactory LIM and building report than I will see how much it cost to correct the title. I have following questions:
Note: This will be my first property and I am planning to live at least 5 years in it but strongly would like to sell after that

1) Is it worthy to buy the property and correct the title?
2)If I am correcting the title how much does it cost me?
3) Is it worthy to correct the title or convert to free hold?
4) If site is converted to free hold still I need to correct the title/flat plan(the picture on title)?
5) How many steps are involved converting from cross lease to free hold?
6) how much should I put a side for this conversion?
7) Where to get lease memorandum of that property?
What is the easiest way to find whether the work on house was done consented or non-consented?

Please note that the other cross lease part/house is also in the market.

May be some of my questions will not make sense to you guys as you all must have good knowledge, I am very new so need some friendly advice.

Regards,

Rocky

[P.Bateman]

Defective flats plans are now very common. As a newbie it always seems like a big deal and your lawyers will always err on the side of caution and call out the defective flats plan as an issue.

Two main things for me:

1) If the part that they have 'added' is a deck or carport etc I wouldn't consider that to be a deal breaker. Its an outdoor area with no electrical wiring etc that can be removed. You could point out the defective plan and ask for X dollars off in lieu of the x lease neighbour asking you to remove it. As a condition of sale you can request that the owner of the other house signs off on the added part

2)If they have added on a garage, laundry, rumpus etc this is a bigger problem as it may affect your insurance (you will have to disclose it). As above point out the defective flats plan and make your offer based on that.

Your other questions-

2) To correct the title you will need to get it resurveyed and redrawn. I looked at this for a house in West Auckland and the cost estimate was $10k+. You need your neighbour to agree with it and pay half but they are well within their rights to say no. Most people now don't correct a defective flats plan but just sell the house as is

3) Have a chat to the council on converting x lease to free hold and the costs. What usually stops people doing it is the cost- you will have to get the site resurveyed and potentially separate out your utilities, pipes etc. Sometimes your neighbour doesn't want to pay half the cost so its not worthwhile going freehold

4) Check the LIM or the Council property file for consents. You can also look at the council website on what requires consent and what doesn't. You can always ask the agent as well and they will be able to either ask vendors or know of any issues

I think with X lease the biggest thing is what sort of neighbour you get on the other property, because its for sale that would be an issue as you don't know whose likely to move in

[m_shah93]

Hi there thank you soo much for your reply. It was extremely helpful. The part is added in the house, the shape of 1 house boundry in the title is L shape whereas in reality they have added some part in the boundary of the house.
The 1 bedroom unit with 1/2 share of 1214 m2 cv is 190k n he is asking 325 k.
Please suggest me is the property is worthy to buy?
If yes how much is a good deal from your experience?
Many Thanks in advance

[Bobsyouruncle]

Defective title is an Americanism so I am guessing you may be from there. If so then title issues there are far more serious than here. Most people would buy the property with no qualms. I have owned many where the council file and what was built was different. It can always be fixed but typically isn't worth doing. Unless your lawyer sees a real problem don't worry about it.

[m_shah93]

Thank u Bob and Pbetman
Bob from yours experience have u ever covert crosslease into free simple? If so how much exactly it cost you from pbetmen I know its over. 10k? N can you elaborate this process in steps including different departments involvement?
From where can I get lease memorandum?
Thanks in advance

[Bobsyouruncle]

Converting is around 12K NZD. There are many companies that specialise in it. PM me for the company I use.
It's fairly simple although the unitary plan changes may have made it even easier so cost could be less. The hard part is getting the other party to agree sometimes.
Your lawyer can get the flats plan and lease from LINZ I believe.

[m_shah93]

Bob thank you so much.

Today I received council file and came to know that they have extended the front part of the house. They have added front part of the house and the inside lay out is completely different than the council file, the initial bathroom door as per council documents is now a wall and previously wall is now a bathroom door. As I mentioned they have extended the front part of the house and the roof also shows two different color.

Bob from your experience as an investor what do you think about that situation? and the council mentioned that there is no building consent was taken after the first building consent. Is that possible that owner has done that amount of work on his house without building consent? and If he has taken the building consent why council can not see the consent application for this work? If the work is done without consent of council what are the consequences for this property?

I am very confuse, please guide me to solve this mystery.

Your help will be much appreciated.

[Bobsyouruncle]

It may be a drama. You'll get varying advice on here. What I would do is get a building inspector to view the file and the property. Costs $500. They will do a report advising what the cost and work required is to get it all legal.
If you are buying to live in then none of that is necessary but many people can't live with something that is not 100 legal so the above is the simplest way to go. I have done several this way. Often all that is required is a building report for council from an approved inspector and the council updates their file and issues a safe and sanitary.

[m_shah93]

Bob thank you so much. All your suggestions and advices are so practical n helpful for newbies like me.
Have a goodnight

[Ziva]

My neighbour had extended their deck without our consent as both of us is on the cross lease property. They had even extend double the size out for their deck n able see through our unit. What should we do?

[OnTheMove]

My neighbour had extended their deck without our consent as both of us is on the cross lease property. They had even extend double the size out for their deck n able see through our unit. What should we do?

If its effecting you, contact legal aide first.