The downside is that these properties are sometimes harder to finance and consequently harder to sell, possibly reducing their resale value. Often times, there is a monthly HOA (Home Owners Association) fee in addition to the land lease fee.
The upside is that properties with a land lease fee are usually sell for less relative to other nearby properties.
There are quite a few Briarwoods in Scottsdale. Comparing Briarwood(s) One through Four in the 85050 zip, there are 11 for sale. Of the 11 homes for sale, there is one bank owned, one short sale and one owner agent, ,so it's a very stable community. Prices range from $138,900 to $399,500 (1,913 to 2,242 sq ft). The smallest home has 1,518 sf and the largest one has 2,697, priced at $199,900 to $295,000, respectively. Land lease varies from $225 to $988 per month and the HOA from $93 to $200 per month. These fees varied by Community as opposed to sq. footage or price, but you can see that would add quite a chunk to your monthly mortgage and many people don't have the cash or income on hand.
You'll need to "run the numbers" to see if the lower price makes sense when you add in the land lease and HOA fees. One other fee that comes up in certain parts of Scottsdale as well as the Biltmore Area is a "PAD" fee -- this is a "planned area development" fee. This fee is usually lower, the one I can think of off the top of my head is at Sandpiper (in McCormick Ranch) -- their PAD fee is only $185 annually.
Good luck with your home purchase! Yvonne
Also note: The HOA fees in Briarwood that the Realtors are providing here are quoted HIGH & incorrect.
Today- the HOA fee for Briarwood V are only $930 annually. That is approx. a mere $77 per month. When calculating the land lease with the LOW HOA fees, Briarwood is a great place and value to purchase Real Estate in the better area of Scottsdale.
I'm a Scottsdale home owner , and Scottsdale Native for 60 years and a 14 year seasoned veteran Realtor. I know what is a great area and a great investment. Some HOA fees in Scottsdale run $240 up to $1500 monthly, so sometimes it's better and wiser to purchase a low HOA fee such as Briarwood V, which does have a land lease fee.. If a Buyer can buy a single family residence in Scottsdale, north of Camelback Rd, south of Shea Blvd, that is 2600 sft, fully remodeled, for under $400,000, including a private back yard pool and have the front yard maintenance included in the HOA fees in a stable area such as Briarwood V, then purchasing in Briarwood is proof that it is a great investment. I say "buy in Briarwood!!!"
Real Estate Consultant and Negotiator
Ryan Buckley RealtorÂ®
Turning your Dream into an Address
Coldwell Banker Residential Brokerage
Landlease monthly fees in Briarwood North can range approximately a few hundred dollars per month to a thousand dollars per month. You also have to add in the HOA Fee which is around $140 per month according to the MLS Listings. You can always contact the HOA to make sure these dollar amounts are accurate.
The landlease could be 15 years or more. You definitely want to find out this information because the landlease could be coming due soon and the fees will most likely be adjusted up. Also if you are applying for a mortgage you want to make sure your loan will be approved based on "leasehold" ownership. Some lenders will not accept leasehold ownership because you do not own the land and the risk involved.
If you have additional questions and need representation contact me.
LISA KATZ, CSSN