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What is leasehold property?

The question “What is leasehold property” often arises with people interested in purchasing maui real estate.

There are two types of land tenure in Hawaii, Leasehold and Fee Simple. When you choose to purchase leasehold property, you purchase the improvement (such as a condo or home), and rather than owning the land the improvement sits on, instead you lease it. When buying fee simple property, you buy the improvement as well as the land the improvement sits on.

One thing to also keep in mind with leasehold properties is the rent payments for the land might escalate.

We generally recommend buying Fee Simple properties. Even though a fee simple property may mean more money in the beginning, in the long run, you’ll be happy you went that route.

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