Land Ownership: In Palm Springs, homes and condos are built on two different types of land, Fee Simple Land and Lease Land.
Fee Land: Fee Simple, or Fee Land is the standard type of ownership in California and mean that you own the land.
Lease Land: Palm Springs is laid out in a checkerboard pattern, with about every other section owned by the Aqua Caliente Indians. Most of the residential properties are owned by individual tribal members, and all lease are administered through the Bureau of Indian Affairs. Although you don’t own the land, the lease gives you the legal right to use the land for the duration of the current lease. The maximum lease period is 65 years, and lease extensions are being done all the time. Historically, leases get extended when they get below 30 years. Leases are typically $2000 - $4000 a year.
Why Buy Lease Land? There are some benefits to buying a home on lease land. The biggest advantage is that prices of homes and condos on lease land are typically 15% - 20% less than a home on built on fee simple land. That means that a home that might cost $650,000 on fee simple land would be up to $130,000 of lease land. That $130,000 could be sitting in the bank, earning interest that could pay the annual lease fee! A lower purchase price means a lower mortgage payment and lower property taxes also.
CLICK HERE for an important brochure regarding lease land from the US Department of the Interior
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