Yorba Linda, is a regular suburban city that is located in Orange County, California, and residents have the benefit of easily reaching Downtown Los Angeles. Richard Nixon, the 37th President of the U.S., was born in Yorba Linda, although he had already relocated to another place before it was incorporated into a city. The former president is still remembered through the Richard Nixon Presidential Library and Museum. Also found in the city is Savi Ranch, a huge commercial district, as well as a number of shopping centers. There are also some 1,000 physical businesses found within the city, including 1,500 businesses that are being operated out of residential houses. Because of that, it is a city with a very low level of unemployment while its economic condition continues to improve.
Yorba Linda Land for Sale & Lease – Should You Buy or Lease?
If you are interested in land space in Yorba Linda, be that as an investment or for construction purposes, you have two choices: buy or lease the land.
Let us look first at the advantages of buying land, which include the fact that:
- You can lease out your land without having any income tax consequences, as long as you pay your income tax on the rent that you get.
- You are the owner of a property, which implies that you have the opportunity to make full productive use out of it for a longer period of time.
- You may retain some degree of control over how the land can be used and developed even if you lease it out. There are usually zoning restrictions in place, which you should have familiarized yourself with before you purchased the land, and this means that those who lease from you will only be able to redevelop your property in a certain way.
On the other hand, there are some disadvantages to buying land, which include the fact that:
- It is possible that you, as the property owner, will lease out your land to a tenant who will then use the land as security for a loan that the tenant applies for. If the tenant then defaults, the land could be at risk of foreclosure.
- You will need to pay income tax at ordinary rates on any rent that you receive. This may or may not be a disadvantage, depending on your specific tax situation.
- You must make sure that the lease document that has ground control included in it, or the tenant could potentially completely redevelop the plot.
- You usually cannot borrow against the equity on the land while it is leased to a third party.
If you simply lease the land, there are certain advantages, including the fact that:
- You will have much lower initial development costs, because there is no need for a substantial down payment and other expenses that come with owning a property.
- You can deduct your rent payments from your state and federal income taxes.
But leasing the land also has some disadvantages, including the fact that:
- The amount you spend in the long term that you will pay for your lease will usually be much higher than what you had paid if you purchased the property. On the other hand, this may not be a disadvantage 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. It is possible that this will make it more difficult to run your business in the way that you believe would be the best.
- You will likely not be able to take any equity out of your business or refinance anything due to ground lease limitations.
- Since a lease is a “diminishing asset”, towards the end of your lease agreement, the value of your business will also be considered as diminished.
To help decide which of the two options to go for, being aware of the trends and statistics in terms of prices, supply, and demand, can be helpful.
Yorba Linda Land for Sale – Trends and Statistics
There are currently two plots of land for sale in Yorba Linda. These are:
- A dense infill location. This is well-positioned in the heart of high-end communities with 280,000 people within a 5-mile radius. This 0.44 acre piece of land is available for $900,000.
- A vacant lot in Yorba Linda itself, available for a residential development. This 0.32 acre plot of land is available for $425,000.
Yorba Linda Land for Lease – Trends and Statistics
There is currently no land available for lease in Yorba Linda.
It should be noted that when investing in land, whether as a purchase or as a lease, there is a big caveat attached to it, which is that of zoning. In many cases, due to zoning restrictions, it is only possible to use a piece of land for a particular purpose. While you may apply for rezoning, this will cost you and it is rarely approved.