So what's the difference between a cross lease title and a leasehold title?
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Freehold (or fee simple)

Translated as "free from hold" meaning that you own the building and the land it stands on - outright. It allows owners to make changes to their land and homes without the consent of neighbours - without needing to change the title (so long as the changes comply with Council regulations and the Resource Management Act).

Cross lease

You own two interests in the property:

A share of the freehold title in common with the other cross lease holders; and
A leasehold interest in the particular area and building that you occupy.

Typically, each person has an exclusive use area of their garden to the exclusion of all the other owners.

These titles usually have a common portion of the driveway.

Neighbours' consent must be granted (along with council approval) if you want to add on or up to your dwelling.

Leasehold

There is a misconception out there that cross lease titles are lease hold.

A lease hold title is when someone else owns the land, you just purchase an exclusive right to possess the land and the buildings on it for a specific period of time.

Shannon CorbettComment
Will the LVR changes affect property values?
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There have been many reports in the media about the performance of the property market — more opinion than fact. Over the years you’ve been reading my updates, you know me well enough to know that I like the facts.

There are some key drivers in any property market: employment levels, net migration, crowding, property sale volumes, construction, affordability, rents, and number of days to sell property to name a few. All of these remain at relatively stable levels.

The first home buyer market is certainly buoyant (new mortgage registrations rose from 24.8% to 26.4% last month) with lenders easing up on restrictions along with attractive interest rates — with no predictions of tightening anytime soon.

Changes to LVR's
The RBNZ Financial Stability Report released on Wednesday the RB noted the slowing in mortgage lending growth and house price inflation. In response they have cut the minimum deposit requirement for investors from 35% to 30% (having cut it from 40% a year ago). And banks may now have up to 20% of their lending to owner occupiers at less than 20% deposit. This had been 15% from the earlier 10% percentage of volume limit.

Will these changes affect property values?
Not really. At least, they certainly won’t lead to large rises in house prices, but the changes should bring further stability to the market. Remember when they imposed the changes as the market was rising?  They were never to bring house prices down, they were just to slow the growth and stabilise the market.  Now it’s the reverse.

The sellers market has passed (2 years ago), but the balanced market environment we are presented with is a healthy one. Values remain relatively stable along with stock levels and sales volumes. I see this property climate remaining similar for a few years yet.

Do I need to pay capital gains tax on the sale of my home?
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The bright line tax property rule says you’ll pay tax when you buy and sell a residential property unless the home you are selling, is your main home.

It's important to note that for need to have used a property as your main home for 50% or more of the time that you’ve owned it and used 50% of the area of the property as your main home. For example, if you use 40% of a property as your home and 60% as a rental property, you can’t use the main home exception.

Another important note to make is that you can't use the main home exception more than twice over any two-year period.

This includes if the property is located overseas.

If the home is held in a trust, the main home exception can still apply if the house sold was the main home of the principal settlor of the trust (the person who has made the biggest financial contribution to the trust), or the principal settlor didn’t have a main home, and it was the main home of a beneficiary of the trust.he bright-line rule does not apply if you sell a property you inherited.

The bright line tax rule does not apply if you inherit a home

So, if the residential home you're selling is not your main home and you bought it from the 1 October 2015 to 28 March 2018, inclusive: the two year bright-line rule applies.
If you bought the property on or after 29 March 2018: the five year bright-line rule applies.

But whenever you buy a property intending to resell it, you’ll need to pay tax on any profit you make when you sell that property.

Before you pay the income tax you owe on your property sale, you’ll need to complete an income tax return. You’ll generally include the amount of property income you’ve earned in the “other income” box on your return.

You’ll also complete an IR833 Property Sale Information form and submit this along with your income tax return.