A land lease could be a foot in the door for many residents looking to move away from renting an apartment and make their way towards owning a home.
With rents and mortgages rising and development costs becoming a hurdle, community builders are looking into unique, creative products to provide attainable housing in today’s market. One local community builder, Fain Signature Group, is proposing a land lease product that provides 300-400 attainable homes within the proposed Lakeshore650 project in Prescott Valley, AZ.
What is land lease home ownership, and how does it help to provide affordability?
The land lease product is not a new concept. RV parks and manufactured housing divisions have been using the concept for years. Fain Signature Group is taking this concept, working to improve the quality of the dwelling and the community amenities, and applying it to entry-level starter homes targeted towards our local workforce and young families.
A land lease acts as an HOA collecting a monthly or annual fee for the portion of land your home sits on. Benefits included in your fee include landscaping, outside home maintenance, shared community amenities, and more.
But above all, a land lease can be beneficial for many home buyers because it eliminates infrastructure costs of the home to significantly decrease the down payment, mortgage, and overall price of a home. This allows an option within reach for those that are stuck renting due to staggering new home prices. While the homeowner is leasing the land, they are also building equity in the home they own, helping them build towards their next home as their families and careers grow.
A land lease may not be for everyone, but it could be a solution for many looking for that first step toward building equity and home ownership.
