When it comes to taking possession of a property, be it land, house, malls, hotels or other types of building, there are at least 3 major ways. There is the option of renting that allows you to use the property for a short time that could be a week. Rent could also allow you to use the property for a long time even though you will only need to renew the rent within a short while regularly. Lease is similar to rent, only that you are expected to negotiate and pay for long-term use of the property. An individual could lease a property for as long as 99 years. With renting the maximum you will be paying for at a time will be 2 years, while some pay monthly or yearly for the property.
For purchases, the property will become that of the buyer with the former owner no longer having any claim to the property. This is as opposed to renting and leasing where the former owner still has a claim to the property, especially at the expiration of the rent or lease tenure. If you have a property you want to rent out or if you have rented or leased property, you should check second home insurance companies reviews on BritainReviews to know the right insurance company to patronize and which insurance policy you should opt for.
If you are wondering if it is cheaper or more expensive to lease a property when compared to purchasing it, then the answer is that in the short time, it is cheaper to lease a property, while in the long term, it is more expensive. However, this will depend on your agreement with the owner of the property. This is because there are instances where even in the short term, it might be more expensive leasing property than renting it.
If a property owner should rent out a property for between 10 to 25 years, they should have recouped the amount they used in setting up the property. The implication is that if you have paid rent for a period of 10 to 25 years, your total rent would have gotten you the type of property you have been renting. However, since the money for the rent is being paid weekly, monthly or yearly, it is always cheaper in the short run.
Leasing, on the other hand, is a long-term affair. However, the length could also result in further discount that could make it cheaper for the same period when compared with renting. Despite this, leasing property for 99 years is likely to be more expensive than purchasing the property even in the short term. The only exception will be if the agreement is that the person leasing the property will pay in instalments for the property.
If you want to lease a property for 99 years and you have enough money to rent for the 99 years, chances are that you will be able to get two times the property you want to lease for that period with the money. In this case, leasing will be much more expensive and it will be better to find another property to purchase. The only exception will be if you must rent that particular property and the owner is not willing to sell. When this is the case, you might have no option other than to lease the property.
In conclusion, if you are leasing the property for a considerably short period like 10 years or less, it might be cheaper. However, if you are renting for several decades, leasing a property could be more expensive.