In the real estate market, particularly in areas like Miami and NYC, leasehold properties present unique challenges and opportunities. These properties allow buyers to own a building while leasing the land from a freeholder for a set period, ranging from decades to over a century. This arrangement, unlike fee simple ownership, can complicate financing and valuation, especially as lease terms dwindle. Buyers must also be aware of additional responsibilities, such as ground rent, and the potential for ownership reversion after lease expiration. Understanding these elements is crucial for making informed investment decisions.
Leasehold ownership means you own the building but not the land, leasing it from a freeholder for a fixed term—impacting property value and financing.
Purchasing a leasehold property is akin to renting with a long-term commitment, as you gain rights to the structure without owning the land itself.
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