Leasehold
Leasehold can be complex, but we make it understandable. Find out on this page what ground lease means, how it works, and read relevant blogs and articles to keep you fully informed.
What is ground lease and how does it work?
Leasehold is a right that allows you to use someone else's land. In exchange, the leaseholder pays an annual fee to the landowner, also called canon.
Entering into an agreement
The landowner grants the right to use the land to the leaseholder, usually for an annual fee (canon).
Canon Determine
The annual fee is set, often based on the value of the land and its use.
Draw up contract
The ground lease contract sets out all agreements, rights and obligations, such as the duration of the ground lease and any revision of the ground rent.
Use and maintenance
The leaseholder may use the land and is responsible for maintenance, but must abide by the terms of the contract.
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Frequently asked questions about ground lease
Learn more about ground leases, what they entail and how they can affect you as a homeowner.
What is ground rent?
Leasehold is a right that gives the leaseholder the authority to use someone else's land. The owner of the land remains the municipality or a private individual, but the leaseholder has the enjoyment of the land and may, for example, build a house on it.
What is the difference between leasehold and ownership?
With ownership, you own both the land and the superstructure (for example, a house). With leasehold, you only own the superstructure and have the right to use someone else's land for a fee.
What is canon?
Canon is the annual fee the leaseholder pays to the owner of the land (leaseholder) for the use of the land.
Can I sell my leasehold right?
Yes, you can sell your leasehold right, but the terms of the leasehold will continue to apply to the new leaseholder. However, the sale often must be approved by the leaseholder.
What happens at the end of the lease term?
At the end of the ground lease term, the agreement can be extended, terminated or converted to ownership, depending on the terms of the ground lease contract.
Can I also buy the land issued in long lease?
Sometimes the ground leaseholder offers the option of buying the land. This is called redemption of ground lease. The possibility and conditions for this vary from situation to situation and must be stipulated in the ground lease contract.
