What are Land-Lease Communities?
The sky is the limit when it comes to buying your retirement home. You have the choice of living in a condominium, townhouse, single-family detached home, etc. But, what about manufactured homes? What are they? Manufactured homes are those that can be connected to all utilities. If you purchase a manufactured home, you are able to use it as a permanent home and you can lease the land your house will sit on, instead of buying the lot outright. This then is known as a land-lease community. As with buying any home, your choice of selecting a land-lease community depends on your preferences. However, it is always wise to move to consider the pros and cons before making any decisions.
Benefits of Considering a Land-Lease Community
Ok, so there are many benefits to considering living in a land-lease community. For one thing, you save money by leasing the land. You don’t have to spend a large sum of money upfront to pay for your lot. Don’t forget, you have to pay for the manufactured home too. If you lease the lot, the bulk amount of money can be invested and you can pay your monthly lease with interest from this money. This also exempts you from dealing with the costly real estate taxes that come with buying land. Another thing that is beneficial with leasing is when you don’t get a profit from the resale of your old home. This can make things a bit hard on the wallet when it comes to buying a home. With a land-lease community, you can purchase your dream home without making a dent in your savings from your old home. Most land-lease communities are run by professional management companies. This means you will not deal with various problems that can arise if it is run by the Homeowners’ Association.
Disadvantages of Considering a Land-Lease Community
Although the financial benefits are quite beneficial when it comes to land-lease communities, there are some disadvantages to this too. For example, when you lease the land you do not have the stability of owning your own home till the lease is paid. The lease will have to be renewed annually or monthly which can be a headache. Another problem is if the landowner decides to discontinue the lease. This means you have to get off the land and find another place to live. Then, the lease rates can increase over time. This means you have to pay more. As mentioned above, most land-lease communities are run by professional management companies. However, sometimes it may be beneficial if the community is run by HOA as they may be more sympathetic to the problems of the homeowners as the board is made up of elected residents of the community.
There you have it; the pros and cons of considering a land-lease community. It is always a good idea to pay attention to all these considerations when selecting your home because once you sign on the dotted lines you are bound to agree with the terms and conditions irrespective of whether you like them.
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