With Vancouver’s scorching home prices not looking like they are cooling down any time soon, many people may be turning to the seemingly more affordable option of a leasehold home. So when – if ever – is a buying a leasehold a good move?
As with any home purchase, it’s all about defining what you want to achieve out of home ownership.
A leasehold home, she explains, is where you own the home but not the land it stands on (or share of the land, in the case of a strata unit). That makes leasehold units more affordable than freehold homes as much of the cost of homes is in the land. But it also means that the landowner charges rent for the land and, even though many leases are pre-paid, the cost of renewing that lease could potentially be extremely onerous.
Answering a listener question on the latest Real Estate Therapist show on Roundhouse Radio, about whether she recommends buying a leasehold home on False Creek as an affordable option.
If it’s purely about lifestyle, you want to have that great location, a waterfront home that you wouldn’t otherwise be able to afford, then maybe leasehold is right for you.
“But if you’re, say, a young couple getting married, maybe there are kids in the future, if you buy a leasehold, you don’t have a legacy to pass on to them.”
