What is a ground rental?
terrestrial lease is long -term lease of land in which a person who owns the land is rented by tenants for a certain period of time. During the lease, the lessee is then responsible for any building on the ground. The country remains the property of the owner and the tenant's improvement can increase the value of the land for the owner. Tenants can choose ground rental to start business to eliminate added land purchase costs. Ground rental is one of the ways to achieve it, and this is done for landow owners. In such a lessee, the lessee basically makes all changes to the country, while the lease agreement is in force, and the improvement of assets that the lessee to operate their business can also cause the value of the overvoltage for the owner.
The typical period of time for ground rental is approximately 10 years, although it can range from just a few years to 99 years. The owner of the land and the lessee will decide how much rent the lessee must pay forYui soil during the lease range. After concluding the lease agreement, the land will return to the original owner along with what was built on the ground unless otherwise specified.
In this way, the landowner not only receives the benefit of the lessee, but can also earn a soil to improve soil that has increased its value. This increased value can be realized if the owner decides to sell the land or hand it over to future generations. For the lessee, this agreement may be beneficial as a relatively cheap alternative to buying land, especially because most ground leases are purchased by a tenant with the intention of starting business on Earth.
There are some disadvantages of the ground rental that both sides of the agreement should consider. For landowners, entry into ground leasing would prevent land sale, while leasing exists. In addition, any increase in soil value would be reflected in income tax. Leasing contract is also a problem for tenants and also the fact that they do not realize noneFinancial gain from the improvement of land.