User:IsonSine148
If you're out looking for condo's in and around the Vancouver area, likelihood is you've come across properties who have the distinction "Leasehold Strata." Appealing as they may be, understanding what you're buying can save you headaches when you eventually decide to sell the property later on.
You're initial curiosity about these properties may have been triggered by the low price of these units with a few units being offered at thousands and thousands of dollars lower than what it would cost to purchase a similar unit using a Freehold Strata distinction. Not just is the price enticing, but additionally many of the Leasehold Strata units in round the Downtown Vancouver area have been in prime locations along False Creek.
Condo buyers' shouldn't run for your hills the minute they start to see the Leasehold distinction on a property, but work as they would when buying any property and look at a number of options before they commit. What might be right for some may not be right for others.
A leasehold strata distinction occurs when a public authority or leasehold landlord the master of a parcel of land leases the land out to get a set number of years to some developer or leasehold tenant. When a developer sells an individual strata lot, the developer sells the developer's interest as a leasehold tenant to the buyer who then represents the interest as a leasehold tenant.
Because the buyer is acquiring the interest of a tenant under a lease, he or she buys the authority to exclusive possession of the strata lot for your balance of the term remaining underneath the lease and the directly to trade that interest. What are the results at the end of the term from the lease will have a big bearing on the value of the house and should be carefully scrutinized. It is crucial that when looking to buy a leasehold strata property, the buyer takes a close look at the model strata lot lease for the formula of the ultimate payout.
Real Estate - The Triton on 10th, the industry development built on land belonging to the Vancouver school board at Broadway and Granville falls into this kind of category where upon expiration of the lease in 2096, the school board must purchase each interest on the current market rate. The cost of a two-bedroom unit within the Triton is about $500-$600 per sq . ft . depending on the layout, direction it faces and which floor readily stored away on. The building is 13 yrs . old, in a location close to shops and restaurants, and minutes from downtown.
A recent sale of your two-bedroom, 1240 square foot unit was $623 000 which can be $502 per square foot. That's hundreds of dollars less per square foot than a comparable freehold strata unit. The Triton on 10th is actually a good fit for someone who doesn't' have the plan for a freehold strata unit. But buyers' should realize that with leasehold properties banks have stricter approval standards, the system can be less liquid when it's time to sell, and they do not see the value appreciation much the same way a comparable freehold unit would.
There are many developments in the downtown Vancouver area along False Creek whereas if the lease expires, there is NO payout. Meaning when the lease expires, the leasehold landlord becomes the rental landlord, as well as the leasehold tenants become rental tenants paying rent at the current market rate. This kind of Leasehold property will depreciate in value and many more so as the lease date approaches. In cases like this as the expiration date approaches to within 30-40 years any owner will have a very difficult time selling the home, namely because you would need to find someone capable of paying with cash because banks will be very reluctant to mortgage such a property.
Vancouver Real Estate - Many properties along Beach Avenue are quickly approaching their lease expiration dates, but inspite of the desirable location, sellers realize that in order to sell such a property they must lower the cost. But as a buyer, consideration must be taken to the price of the unit and the number of years until the lease expires.
