Cross lease titles are one of the most common — and most misunderstood — forms of property ownership in New Zealand. Whether you're buying your first home or investing in property, understanding how cross leases work can save you from costly surprises.
What Is a Cross Lease Title?
A cross lease is a form of shared property ownership where two or more owners each hold a share of the freehold land, combined with a lease from all landowners granting each the exclusive use of a specific building or area — called a "flat" on the title. It was introduced as a cheaper alternative to subdivision, but it comes with unique obligations and restrictions.
Unlike freehold titles where you own the land outright, a cross lease means you co-own the land with your neighbours. Your exclusive right to use your dwelling comes from the lease, not from outright ownership of that portion of land.
💡 Good to know:
Cross leases account for approximately 10% of all residential properties in New Zealand, with higher concentrations in Auckland, Wellington, and Christchurch. They were especially popular between the 1960s and early 2000s.
How Cross Lease Titles Work
Each cross lease property has two key components recorded on the title:
The Flats Plan: Why It Matters So Much
The flats plan is arguably the most important document for a cross lease property. It shows the exact footprint of each building on the site. If any owner makes changes to their building — such as adding a deck, conservatory, carport, or extension — that don't match the registered flats plan, serious problems arise.
- 🚩Unapproved alterations — Any building work not shown on the flats plan can make the title defective
- 🚩Bank lending issues — Many banks won't lend against properties with an outdated flats plan
- 🚩Neighbour consent required — Updating a flats plan requires agreement from ALL co-lessees, which can be difficult and expensive
Cross Lease vs Freehold vs Unit Title
What to Check Before Buying a Cross Lease Property
Converting Cross Lease to Freehold
Many cross lease property owners consider converting to freehold to gain full ownership and remove the complications of shared titles. The process involves subdividing the land, which requires council resource consent, a new survey, and agreement from all co-lessees. Costs typically range from $15,000 to $30,000+ depending on the complexity and council requirements.
🛡️ Pro tip
Before starting conversion, order a Record of Title to understand exactly what interests and restrictions are registered. This will inform your surveyor and solicitor's advice on feasibility.
Frequently Asked Questions
🔍 Check Your Cross Lease Title
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