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Updated about 21 hours ago on .

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DR Rearwin
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How is the value of a condo ground lease determined for a buyout?

DR Rearwin
Posted

Our condo is on a ground lease that expires in 35 years. Our HOA is considering buying the lease so that the entire condo will become fee simple. How is the value of the lease determined for a buyout? The current monthly payments from all units will remain constant for 35 years, but obviously the value of those payments will be worth far less 35 years from now due to inflation. Perhaps 1/3 to 1/4 of current value. What is the most common formula to determine a fair price for a lease buyout?