The Galbes in Huntington Beach is a great place to find lower priced condos near the beach. One of the reasons for these low price points is that they are located on lease land. The lease is scheduled to become due on December 31, 2059 according to current real estate listings in the Gables. What does this exactly mean. Here is a quick run down of the land lease situation.
First, owners of the gables don't own the land that is underneath their home and pay a yearly fee to use the land. This is called a land lease with is essentially a contract to use the land for a certain period of time. The fee is paid on top of the current $316.00 a month homeowners association. One of the current listings has the and lease fee paid annually at $8400.00 which breaks down to $700 a month. So $700.00 + $316.00 = $1,016.00 a month fee on top of any mortgage payment that you may have. This is something to consider irregardless of the due date for the land lease.
The land lease becomes due in 2059 and has a couple potential implications. Getting a loan may be difficult as we approach the 30 year period of when the lease will end. Lenders typically don't like to lend on a property when they known the lease will come to an end before the mortgage can be paid off in full. We see this at the Lido Peninsula community in Newport Beach where the lease is soon to expire. Another consideration is that as we approach the due date if may be tougher to sell a home in this community if lenders won't lend on it. This may restrict sales to only cash buyers.
For the most part we see these land leases renewed for another set period of time but there is always the chance that the owner of the land may not renew. In that case you still own the property but would not have the right to have it reside on that parcel of land. We have seen this in other mobile home parks in South Orange County where the lease was not renewed due to a new construction condo development was going to be built. We encourage you to ask a lot of questions when considering buying a home on lease land. If you have any questions please contact us at 949-482-1313 today.
Huntington Beach 16094 Warmington Lane 16
completely remodeled and ready to move in. Spacious floor plan. Upgraded kitchen that opens to family room, custom wood cabinets with self-closing hinges, granite counter tops, stainless steel appliances, recessed lighting and stone backsplash. New hardwood flooring and gorgeous planked tile in the laundry room and bathroom with 6 inch molding throughout the home including new heater and central air-condition. Dual pane windows with custom shutters upgraded bathroom with floor to ceiling tile...$339,000