In a nutshell:
Traditionally, when you purchase a home, you own the home and the land the property is built on. There are some circumstances that involve a land lease, which means you would own the home while paying rent to the landowner for the land.
- A land lease property might be the way to go if you are looking to own a home in a great location for a fairly low price.
- Land lease properties usually have lower property tax payments since the land is not part of the home's valuation.
- Land lease payments are tax deductible.
- Land lease properties are usually part of an HOA, so you may have to pay HOA fees in addition to the land lease.
- The property might be difficult to finance or sell in the future.