Some ownership types include limitations and restrictions that may inhibit your enjoyment or use. The ownership type also indicates what it is that you own, structure, a specific portion of the structure, or both the land and the structure. 

A Freehold Strata property is one where the purchaser legally owns both the property and the land in which the property is built on. This is the most common in BC and what most buyers expect as a form of ownership. 

Leasehold Strata property is where you do not own the land that the property sits on but have the “right to use” the land until the end of the lease term. You do own the suite in the building and a portion of the common area, halls, lobby etc. The leases are often 60 or 99 years in length. The length of a lease may not be concerning to someone purchasing at the beginning of a lease, for properties nearing the end of a lease the value diminishes substantially. Leasehold properties are less desirable as investments in the long run, as at the end of the lease, the leasehold owner’s investment is close to nothing as the increase in value is always in the land.  

Some lenders will not finance leasehold properties and those that do may demand higher interest rates.

This is a very simplified explanation to start the conversation. When thinking of purchasing your next property, it's essential you understand the difference between ownership types. 

Are you looking to buy or sell property? If you’d like, we can have a real estate expert show you the most efficient process that saves you thousands of dollars, a lot of time, with little or no inconvenience to you. Contact us today!

Source:  Michael Cowling