Garden Grove is a city found in the northern part of Orange County, California. It is just 34 miles to the south of the Los Angeles city border. According to the 2010 U.S. Census, it had a population of 170,883 at that time. The city is home to the Garden Grove Freeway, which is State Route 22, and this crosses the city from east to west.
Garden Grove Land for Sale & Lease – Should You Buy or Lease?
If you are interested in land in Garden Grove, as an investment or for construction or some other purpose, you have two broad options available to you: buying or leasing. There are pros and cons to both of these options.
Looking first at buying land, the pros include:
- You can lease out your land without having any income tax consequences, so long as you pay your income tax on the rent that you receive on the land.
- You become the owner of a property. This means you have the opportunity to have a truly productive economic use of the land for a long period of time.
- You may retain a degree of control over how the land can be used and developed. There are usually zoning restrictions in place, which you will have known about before you purchased the land, and this means that those who lease from you will not be able to redevelop your property in a way that you do not want them to.
However, there are downsides as well:
- If you lease out your land to a tenant and allow the land to be used as security for the financing of the tenant, the land could be at risk of foreclosure if the tenant defaults.
- You will pay income tax at ordinary rates on any rent you receive.
- If your lease agreement does not have ground control included in it, the tenant could potentially completely redevelop the land.
- You usually cannot borrow against the equity on the land while it is leased to a third party.
Your other option is to lease your land, which also has benefits:
- You will have far lower initial development costs, because you do not have to acquire any land.
- You can deduct all your rent payments from your state and federal income taxes.
However, there are some downsides as well, including:
- Usually, the total amount that you will pay for your lease for the long term will be much higher than if you purchased the property. This is not always a disadvantage, however, as it depends on whether you intend to be at the same location for a long period of time.
- You won’t have as much flexibility when it comes to how you would like to develop the land that you are leasing.
- You will probably not be able to take any equity out of your business or refinance anything due to ground lease limitations.
- A lease is considered to be a “diminishing asset”. Thus, towards the end of your lease agreement, your business value will also be diminished.
Being aware of the trends and statistics in terms of prices, supply, and demand, can be very helpful in deciding whether to lease or buy.
Garden Grove Land for Sale – Trends and Statistics
Four pieces of land are currently for sale in Garden Grove. Those are:
- A premier intersection at Little Saigon, measuring 0.48 acre. It is available for $3,150,000 and has been zoned for retail. It is very rare for opportunities to be available in Little Saigon, and interest in this particular plot of land is therefore very high. Due to its prime location, it is also signalized. Interestingly, it is on the busiest intersection of Little Saigon, which means any development is very likely to be successful.
- A retail lot at Garden Grove/Seal Beach, measuring 0.47 acres, available for $1,220,000. It has been zoned as a retail development and is also in a very good location. As with the Little Saigon lot, this is a very rare opportunity and one that is likely to be very successful.
- A residential lot measuring 7,000 square foot in a very well established, popular neighborhood. It provides people with a rare opportunity to build their own home, right in the downtown Disney Resort area. The price is $379,000.
- Four adjoining lots that were zoned as commercial, but have been rezoned into residential and multifamily properties as well as commercial properties. At 0.57 acre, the lots are available for $2,500,000 and come with paperwork from the city to confirm the acceptance of the rezoning application.
What these lots demonstrate is the variety of land that is available, and that it can suit the interest of a range of different investors, developers, and even private owners.
Garden Grove Land for Lease – Trends and Statistics
Only a single piece of land is currently available for lease in Garden Grove. This is a rear parking lot, suitable for storage of a car or an RV. The lot is 0.80 acre in size, and the available space is 0.11 acre. It is available for $8.40, and has been zoned as commercial/other land.
It should be noted that in many cases, due to zoning, it is only possible to use a piece of land for a specific purpose. While rezoning applications may be presented, these have to be paid for by you and are rarely successful.