Land Lease questions (Dover, Long Neck, Magnolia: leases, house, to buy)

[MPBsr]

The Mrs. and I were down around Dover and Magnolia looking at 55+.

Right outside Dover was a development called Nobles Pond. Very nice and the homes were big. Actually a little to big for what we want, but the prices were lower because of it being a land lease.

I understand the basic concept of land lease, but what else should we be concerned about it or is it no big deal that you don't own the land?

On the bright side the homes were $50,000 less than Magnolia (Champions Club). But taxes could be as high as $1500, of which I don't understand.

The taxes in Magnolia (land owned) are $1500
The taxes in Dover (land leased) might be $1500

Why the same if owned v. leased???

And why would I lease land when I can own it???

[rossc]

Originally Posted by MPBsr

The Mrs. and I were down around Dover and Magnolia looking at 55+.

Right outside Dover was a development called Nobles Pond. Very nice and the homes were big. Actually a little to big for what we want, but the prices were lower because of it being a land lease.

I understand the basic concept of land lease, but what else should we be concerned about it or is it no big deal that you don't own the land?

On the bright side the homes were $50,000 less than Magnolia (Champions Club). But taxes could be as high as $1500, of which I don't understand.

The taxes in Magnolia (land owned) are $1500
The taxes in Dover (land leased) might be $1500

Why the same if owned v. leased???

And why would I lease land when I can own it???

I have a place on the water on leased land. It took me a while to make the decision to buy it. I guess what convinced me was looking at comparable sized lots...Land only...at $700,000+. I paid $80,000 and my land lease is only $1700/year. If I had bought something not on the water, I don't think I would have done the leased land thing. If you can own the land, that is the way to go. At $700,000+ there was no way I could own my waterfront lot. There seems to be lots of the leased land communities popping up, most with glolf courses and some with land leases over $12,000/year, and they seem to be selling.

The tax differences are probably just the difference in rate between Magnolia and Dover.

Ross

[MPBsr]

Originally Posted by rossc

I have a place on the water on leased land. It took me a while to make the decision to buy it. I guess what convinced me was looking at comparable sized lots...Land only...at $700,000+. I paid $80,000 and my land lease is only $1700/year. If I had bought something not on the water, I don't think I would have done the leased land thing. If you can own the land, that is the way to go. At $700,000+ there was no way I could own my waterfront lot. There seems to be lots of the leased land communities popping up, most with glolf courses and some with land leases over $12,000/year, and they seem to be selling.

The tax differences are probably just the difference in rate between Magnolia and Dover.

Ross

The land lease in Dover was $4800 plus $850-$1600 in taxes. Even thought that includes, grass cutting and snow removal for streets only, still doesn't feel right.

Two years ago, we looked at a waterfront house in Long Neck. After seeing the house, we figured it was a knockdown and for another $100,000 could drop a module on the property. We fell in love with the view of the Indian River, but then got a shock when we found out the land lease was $13,000 a year, plus $400 in taxes. Needless to say we didn't buy.

So it's either Magnolia, or we just might end up down in Cape May where the taxes were only $3100-$3500.

[ricksr]

My wife and I leased a lot in Long Neck area for a summer home, and when the lot rent went from $3,100 a year to $6,300 in 4 years we felt it was time to get out. Evidently De has no regulations concerning increases and all it took was 1 GREEDY owner to jack up rates so now they all are doing it. So for anyone debating the land lease/rent option, I would strongly suggest you research it completely.

[MPBsr]

Originally Posted by ricksr

My wife and I leased a lot in Long Neck area for a summer home, and when the lot rent went from $3,100 a year to $6,300 in 4 years we felt it was time to get out. Evidently De has no regulations concerning increases and all it took was 1 GREEDY owner to jack up rates so now they all are doing it. So for anyone debating the land lease/rent option, I would strongly suggest you research it completely.

This land lease in Dover claims a max of 4.5% increase a year, which I think is a good possibility and to high.