Why Freehold Is Preferred

propertiesThe spat between two wealthy neighbours over a shared driveway is just one of many examples why freehold property and land titles are preferred. On the discussion forum PropertyTalk there is a lot of talk of cross-lease titles and the cons of buying cross leased properties.

A challenge with cross leases that’s discussed a lot on PropertyTalk is the requirement to gain approval by all owners of the shared land for any work done that may affect their use of the shared land. If an owner wants to add a fence or do any external renovation work all owners who have a share of the land need to approve it. There are cross lease titles that have revised provisions however the standard requires joint approval.

We have all heard of ‘neighbours at war’ and cross leases can heighten any existing tension between neighbours. Essentially extra special effort is required to remain neighbourly when your neighbours are extra close.

With intensification of our cities cross lease titles are more acceptable. They are used for shared land including driveways. The year long legal battle between wealthy neighbours in Takapuna is a warning that more of the same will come as the desires of one neighbour clashes with those of the other neighbour. This particular spat worthy of a mention in NZHerald ended well for the neighbour fighting to add in an extra gate to protect his young family.

Property investors hold properties that are on cross leases and freehold titles. Freehold titles are worth more however cross leases are more acceptable now especially where there is a lack of supply of property and PropertyTutors mentoring clients have had a lot of success with them recently particularly in Auckland.

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