Why Is A Lease For 99 Years?

1
Home gt Blogs gt Why is a lease for 99 years?
Why Is A Lease For 99 Years?
Mar 2018
In Green Homes
The properties are apparently of two kinds-
freehold property and the leasehold property.
While former refers to the properties that are
free from the hold of other entry except for
owner for the indefinite period, latter are
properties generally leased for the period,
commonly for 99 years from construction time.
But, why this unusual figure, 99? Or what
actually happens or who actually owns property at
end of the lease period? Or maybe the applicable
renewal conditions?
Here is why leases are for 99 years only-
The authority of development of a specific area
gives the land development rights to the
developers as well as sells properties for the
lease of 99 years. This basically means that
anyone who would buy a commercial or residential
property will own it for a time period of 99
years after which ownership is provided back to
the owner of the land. The home buyers of
leasehold properties are required to pay the
ground rent to landowners for specifically this.
Lease of such properties can renew after term
completion. What happens upon the expiry of the
said Lease? Generally, the government allows the
conversion of the leasehold property to the
freehold upon the payment of the conversion
charges or it guarantees correct to buy another
lease upon the expiry of the original
lease. Buying an older house The investor eyeing
the old property may actually find it pretty
difficult to furthermore sell the property as it
would not actually be easy for prospective home
buyers to finance it. Such properties might not
see an integral appreciation as well. The prime
challenge faced by the home buyer is the renewal
of the contract of occupancy once the lease is
actually over. Along with the renewal, the old
properties also need additional price such as the
property tax. Furthermore, a buyer could actually
face the challenges of transferring property
title as well as the registration papers. On the
other hand, if descendants of the leasehold
property do possess the property for 99 years,
they will certainly require paying for the lease
renewal. From the point of view of the developer,
the projects that are planned for smaller
leasehold periods may not get the funds for the
construction which could lead to any delay and
non-completion. Why 99 years? 99 years lease
agreement basically includes the obligations and
rights of both the lessor as well as the lessee
pertaining to the occupation of property in the
exchange for the amount set as the rental. The
terms and conditions that are mentioned in the
agreement such as lease period, nature of rights,
duties of the lessor and the lessee, termination
clause, conditional clauses, dispute resolution
clause, etc. are pretty crucial factors for the
sustenance of the lease and dispute in the
respect of lease. The objective of having the
time span is to actually control the use and land
transfer. This span of time was seen as a safe
interval choice in previous days provided that it
will cover up the lifespan of the lessee. Also,
it was regarded as the period enough to safeguard
the lessor ownership.
Some facts about the leasehold property
2
It is possible to actually extend the Lease
period to 999 years by paying the price New
OkhLa Industrial Development Authority proffers
land to develop apartment projects only on the
leasehold The developers do prefer to build
an apartment on leasehold lands since the cost of
parcels is much lower when in comparison to the
freehold lands On the purchase of property
on leasehold, the buyer must confirm whether the
seller has actually obtained a transfer
memorandum from the local development authority
The prime advantage of investing in the
leasehold property is the rate which is lesser
than the properties that are built on freehold
land
n
PREV ARTICLE
Comments
There is 0 comment on "Why is a lease for 99
years?".
Submit A Comment
your comment...
yourname...
your email...
SENDCOMMENT
Related Posts
ESfljsmerciaL fMMifjpIg ffiHfceEtaiysrit MiuMbai R
nnstaential Hnetiacir Reptyty Market In India
lt gt
Top Rated
Recent
Cities To Become Smart With GIS Technology There
has been Lot of buzz around the... On June 22,2016
3
8 Reasons You Should Consider Buying Than Renting
In the current monetary atmosphere, there is
no... On June 10,2016
RERA Regulation Bill Brings Cheer In Rajyasabha
Assembly The RERA (Real Estate Regulation
Authority)has certainly brought... On June 22,2016
Competition For Real Estate Agents In India By
The World's Biggest Brokerage Firm If you are fed
up of continuous calls... On May 3,2015
Coldwell Banker Principled Realty When we visited
Knox Realty office for the... On March 3,2015
Categories Green Homes Home-grown News!
News Property T rends Realty Affairs
45
1
20
2
2
Recent Posts PLC Is Taxable. Read On To Know
More While you were planning to invest in the
real estate, you would... On
FATCA Impact On NRIs Property In India The United
States Foreign Accounts Tax Compliance Act is
prompting numerous NRIs... On
Things T o Keep In Mind If You Are T ransferring
Sale Are you thinking about selling your
property? Well, profit you actually earn... On
NRIs Power Of Attorney To Sell Property In
India If you are a non-resident Indian and want
to conduct the huge... On
Commercial Hub BKC Emerging As A Residential
Sector Bandra Kurla Complex in Mumbai was
initially developed as a business district... On
Ways For NRIs To Invest In The Stock Market In
India NRIs or Non-resident Indians who wish to
invest in Indian securities markets...
On
4
How To Protect Your Property And Wealth? Some of
the rich families in India run a family business.
Also,... On
What Makes Thane An Attractive Realty
Market? Strong connectivity, as well as the
flourishing economy, has actually been the... On
Rules That NRI Investors Should Follow This could
be the appropriate time for non-resident Indians
to invest in... On
Quick Contacts
Phone No. 91 22 6736 4000 Email
info_at_coldwellbanker.in
(
Copyright 2017, Coldwell Banker India. All
rights reserved.