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Types of subdivision
Types of subdivision

There are many different ways you can subdivide your property. The most common forms of urban subdivision are – Freehold (Fee Simple), Cross Lease, Unit Title.

Freehold Subdivision – this can also be called Fee Simple Subdivision.
This is the most common type of subdivision where the land is subdivided to create separate Certificates of Title for each new lot. The new pieces of land are then solely owned by those named on the Certificate of Title.

Cross Lease Subdivision.
This used to be a common type of subdivision and a way of circumventing the Council rules of the time. The total area of land is owned in equal shares by all of the owners of the cross lease.

The individual owners then lease a particular building or buildings that are shown on the Flats Plan for 999 years. The share of land that their building sits on and the building is then registered in a cross lease agreement on the Certificate of Title. It is an inferior form of ownership compared with Freehold as you must always consult with the other landowner and gain permission for any changes to the shape of the building and the Certificates of Title. However it is still a common form of ownership and we can amend cross lease Certificates of Title as required.

Because the exterior walls of the building are shown on the flats plan, every time the shape of the building changes a new cross lease plan should be prepared. Council generally treat cross lease development the same as freehold title development, so most people opt for a freehold title rather than a cross lease title.

Unit Title Subdivision.
This form of subdivision is used mainly when one building is over another i.e. an apartment complex. Unit titles can also be used for individual houses, joined houses or a commercial block of buildings where the owners share common land. In each case a Body Corporate (owners committee) is set up to administer the property, and all property owners become members of the Body Corporate. A Body Corporate can be useful if you want to govern how a development is to look or to manage areas of common land. The Body Corporate can employ a company to administer the Body Corporate rules, collect any levies and keep all property owners informed.

Rural Subdivision
Similar to the subdivision of the land around your house in town, larger rural blocks can be subdivided as well. Individual Certificates of Title for smaller rural or lifestyle blocks can then be obtained. There will be specific rules in the local Council District Plan that will govern how you can subdivide rural land and the requirements to be met.

With each of these forms of subdivision you may also wish to discuss the options with your solicitor to ensure the form of title to be created will meet your requirements.

As qualified resource managers we can help you decide the best way to maximise your subdivision in terms of the local Council’s rules to achieve your desired outcomes.