Читать книгу Sell Your Home in Canada - Geraldine Santiago - Страница 17

A leasehold interest in land means the townhouse, apartment, or detached home is built on city-owned land. The term “leasehold” can also apply to single detached houses on farm land, on First Nations land, and so on. Leasehold interests are for a defined period of time. They can be for a week, a month, a year, 99 years, or any other specific period of time. The person to whom leasehold interest is granted is called a lessee or tenant, and the grantor of the interest is called the lessor or the landlord. If a leasehold has a fixed term of 99 years, for example, there will be no review of the lease rate for the full 99 years. If the previous lessee has lived in a building on the leasehold for 20 years, you may purchase the remaining portion of 79 years. The shorter the remaining portion, the less a buyer will pay for the leasehold interest.

If you are selling a leasehold property, provide a list of financial institutions that are receptive to financing this type of sale.

It is important to know that the sale of a leasehold differs greatly from the sale of a freehold property. For one thing, pricing does not reflect market value; you are only selling the improvements on the land, and not the land itself. If you are selling a leasehold property, financing may be a buyer’s biggest obstacle, as many institutions will not finance this type of sale. To help buyers, you should try to provide a list of financial institutions that are receptive to financing this type of sale.

Further, many institutions may want a larger down payment to protect themselves from buyers who simply walk away from the property should there be a problem down the road. Other financial institutions may want to make sure that the prepaid lease has a long lifespan, 99 years or more.