Buying Leasehold Land in BC: What Buyers Need to Know
Tanya Toye • November 20, 2025
If you’ve been exploring real estate options, you may have come across properties built on leasehold land. While freehold ownership is the most familiar form of property ownership, leasehold can offer unique opportunities for some buyers.
Here’s a breakdown of what leasehold really means, along with its pros and cons to help you decide whether it’s the right fit for you.
What is leasehold land?
Leasehold land is property where you own the home or unit, but not the land beneath it. Instead, you lease the land from a landlord – often the government, a university (such as UBC), a First Nations band or a private landowner. These leases typically range from 30 to 99 years. When you buy a leasehold property, you’re essentially purchasing the right to occupy the land for the remainder of the lease term.
Pros of buying leasehold
- Lower purchase price. Leasehold homes usually come with a lower price tag compared to similar freehold options. This can make desirable neighbourhoods more accessible.
- Potentially larger or newer properties. Some leasehold developments offer spacious layouts, modern amenities or prime locations that may otherwise be out of reach in the freehold market.
- Predictable lease terms. Long-term leases provide clarity on costs and expectations, including scheduled lease payments or renewals.
Cons of buying leasehold
- Financing challenges. Not all lenders finance leasehold properties, and those that do may impose restrictions based on the remaining lease term. Shorter leases can mean higher risk and fewer mortgage options.
- Uncertain future value. As the lease term shortens, property values may decrease. This can impact resale value and marketability.
- Lease payments and fees. Some leasehold properties come with annual lease payments in addition to strata fees. These ongoing costs need to be factored into your budget.
- Renewal uncertainty. When a lease nears expiry, renewal terms – if they’re even offered – can be unpredictable. Buyers should fully understand the renewal process before committing.
Is leasehold right for you?
Leasehold properties can offer great value, but they come with considerations that are different from traditional ownership. Before making a decision, it’s important to review the lease agreement carefully, understand financing limitations and consider your long-term plans.
If you’re exploring leasehold options in BC and want clarity on your mortgage choices, I’m here to help you navigate the details with confidence. 604-788-8693 |
tanya@tanyatoye.ca
When you’re buying a home, two terms often cause confusion: deposit and down payment . While they’re related, they serve very different purposes in the homebuying process. Here’s what you need to know. What Is a Deposit? A deposit is the money you provide when you make an offer on a property. Think of it as a show of good faith that proves you’re serious about purchasing. How it works : Typically, you provide a certified cheque or bank draft that your real estate brokerage holds in trust. If your offer is accepted, the deposit remains in trust until the deal moves forward. If negotiations fall through, the deposit is refunded. Connection to your down payment : Once the sale is finalized, your deposit becomes part of your total down payment. Why it matters : The amount is negotiable, but a larger deposit can make your offer more attractive in a competitive market. Keep in mind, however, that if you back out after conditions are removed, you risk losing your deposit. What Is a Down Payment? Your down payment is the amount you contribute toward the purchase price of your home when securing a mortgage. Minimum requirement : In Canada, the minimum down payment is 5% of the home’s purchase price. Anything less than 20% requires mortgage default insurance. Sources : Down payments can come from your savings, the sale of another property, RRSP withdrawals (through the Home Buyers’ Plan), a gift from family, or even borrowed funds. Example: How They Work Together Imagine you’re buying a $400,000 home with a 10% down payment ($40,000). When you make your offer, you provide a $10,000 deposit . Once conditions are met, that deposit is transferred to your lawyer’s trust account. At closing, you add the remaining $30,000 to complete your full down payment. The lender provides the rest—$360,000—through your mortgage. The Bottom Line Your deposit shows commitment and secures your offer, while your down payment is what makes the mortgage possible. Together, they work hand in hand to get you into your new home. 📞 If you’d like clarity on deposits, down payments, or any other part of the mortgage process, let’s connect. I’d be happy to walk you through it step by step.
Being self-employed comes with plenty of advantages, including the ability to structure your business how you choose and claim expenses to reduce your taxable income. But, when it comes time to apply for a mortgage, those same tax strategies can sometimes make qualifying more complicated. One of the first considerations is how your business is structured. There can be differences in how lenders assess income for someone who is incorporated compared with someone who operates as a sole proprietor or partnership. Depending on the lender and the circumstances, income may be reviewed using personal tax returns, corporate financial statements or a combination of documents. Another important factor is the level of business write-offs you claim. As a business owner, reducing your taxable income can make good financial sense. However, a lower reported income can also mean a lower qualifying income when a lender assesses your mortgage application. This can create a frustrating situation where you may have strong cashflow and the ability to comfortably afford the mortgage, but your tax returns don’t necessarily tell the whole story. That doesn’t automatically mean you need to start declaring significantly more income and paying substantially more to the CRA just so you can qualify for a mortgage. Alternative mortgage solutions may be a great option Depending on your circumstances, there may be alternative mortgage solutions available that take a broader view of your financial situation. Some lenders have different approaches to self-employed income and may be able to consider additional documentation or alternate methods of demonstrating your ability to repay the mortgage. This can create an important financial decision for self-employed borrowers. Is it more beneficial to pay additional taxes to show a higher income or consider a mortgage option with a higher interest rate that may allow you to qualify based on your existing financial structure? There isn’t a one-size-fits-all answer. The right approach depends on your income, business structure, financial goals, credit profile, down payment and how long you expect to be in that mortgage. The key is to have the conversation before you make changes to how you report your income. A mortgage broker who understands self-employed borrowers can help you explore your options and compare the potential costs of different approaches. Instead of assuming you need to change the way you run your business to qualify for a mortgage, it may be worth looking at the lending solutions available to you first. Being self-employed shouldn’t automatically make getting a mortgage more difficult. It just means your mortgage strategy may need to be as individual as your business. Let’s discuss your options. 604-788-8693 | tanya@tanyatoye.ca
