Can you please explain the different property Titles?
Question from Martin updated on 18th February 2010:
Our expert responded:
Ownership of an estate in fee simple is not limited by time and continues indefinitely. This type of ownership comes with a load of rights, such as to dispose of the property by will, by gift or sale. There are of course statute limitations if the land is controlled by the Resource Management Act 1991 or if the property is to be sold to someone overseas. They would be affected by the Overseas Investment Act 2005.
The Unit Title Act 1972 was designed to allow for development of high rise apartments, buildings, and commercial units. This enables the issue of a separate Title to the registered owner. The Title will comprise of an estate in the unit and any garden, garage or other accessory, an undivided share in the fee simple or lease hold estate in the common property and an undivided share in the fee simple.
Interesting though the Government are proposing changes to the Unit Title Act to bring it into alignment to deal with Strata Title proA Cross Lease Title is also known as a Composite Title. In simple terms: The owner of a Cross Lease Title holds an undivided share as tenants in common in the fee simple of the whole of the land upon which the flats are erected. Essentially the share will depend upon the number of flats on the property.
There is than a Leasehold estate with a Lease generally for 999 years for the flat itself, furthermore a nominal amount of rent @ 10c is contained in the Lease. When purchasing a Cross Lease Title it is very important that you obtain a copy of the Cross Lease Title, Flats Plan and all encumbrances associated with the property.
There would be more advantage to purchase freehold property over any other estate.
These Titles generally come with no headaches. Unit Titles and Cross Lease properties from a Conveyancers perspective can be a nightmare. Thorough due diligence highly recommended in particular with Cross Lease properties around additions.
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