Leasing Land in Tonga vs Buying Freehold in Fiji

Leasing Land in Tonga vs Buying Freehold in Fiji

This subject can take many pages of lateral thinking to fully grasp the advantages leasing land has over buying land. I will sum it up quickly and explain it slowly.

Firstly, know that we judge things by association, by comparison and with assumptions, which, without the facts and full story we can be thrown off from our ability to see things for what they really are. Leasing land has the stigma of “not owning it,” which actually can be said of freehold too, when put to the test of ownership of what happens if you fail to make some payment either in tax or mortgage. If you default you lose your land, same is true with leasing should you not make the annual/monthly payments.

Freehold is forever, but then it is said; “nothing is forever” so what is the future of anything, let alone freehold land? Lease land is for a specific term. For residential purposes it is generally for 99-years and renewable, for whatever that is worth given it is likely to be our Great, Great Grandchildren renewing at the Land’s office with limited personal spaceship parking. Some things will probably never change. 

The number one reason to lease land vs buy land is; lease land is generally, substantially lower in price than freehold. In Fiji, a freehold beachfront half-acre lot can sell for $200,000 to $300,000 USD when located within a half hour drive of any main town. Leased land’s frontend cost can be one tenth that of freehold with both freehold and leased land equally desirable. Of course lease land has a monthly or annual payment and that can be another $350 USD or so per year.

The number two reason for leasing land in Tonga is; you can live like the people with ten times your budget, right on the beach if you want and no different than if you owned it. Like leasing a car, you have the same basic rights of ownership and with land you don’t have to worry about how much you use it for there are no mileage limitations. After 50 years or so, you will probably get over the idea that you don’t own the land. Some achieve that in 50 days for the difference in how the lay of the land or how the ocean rolls up on the beach is EXACTLY the same for lease and freehold. Nature is indifferent to manmade rules.

If you are still not convinced and see leasing negatively, consider there are often positive ways to see negative things. When you bother to get into it, every negative out there seems to have a positive in there to offset or even flip the negative into better positive. You just have to analyze it and see it for what it really is. For example; if you want to live in a nice home with the ocean scene taking up your whole picture window and a beach below, and all you have to spend is $100,000; you would be out of luck when a “freehold” lot without a house on it could cost more than your entire budget. With lease land that same $100,000 can do both, secure the beach land and leave you enough to build a proper home, which is certainly a lot better idea than just flying home with an empty dream. If you insist on freehold and you don’t have or can’t budget the money to live on it like you want or should, your life in paradise is ruined.

Fiji has seen the light too and is just now considering leasing as an option to freehold. Leasing can save the day and allow you to retire and acquire that which suits you to perfection. The high cost of freehold might have you living in a tent on your expensive freehold land next door to the lease land with the same beach, same view, same sea as your neighbor and for the same money has everything you have and more, much more considering the cost differential. Buying freehold suffers because your budget went for the land, not for your life on the land—that would be your home.

If you want to live and look like the rich and famous, put your money into the show house, the living part of your investment. The land is going to be as pristine as any freehold to support the same look and feel.

One must consider this leasing option versus waiting and maybe never achieving this lifestyle in their lifetime. If saving up the cash is your other option to get freehold, that takes time and time is precious, at least for us expats time is precious, but we will never convince many Islanders of that concept. Island time is infamously slow in South Pacific. Why? Because when you are living in the moment, the ever most pleasant and continuing moment, immersed in nature’s most comfortable and peaceful surroundings, you don’t mind the time it takes for about much of anything.

Back to land; Yes freehold is preferred if you have the budget to afford it and it comes with the same view and waterfront, and you’ve money left over for the uncompromised home too, go for it. The next thing to freehold are renewable 99-year land leases.

Leasing has its place certainly, even when you have the choice of either, as in buying a car for cash or leasing it, leasing is often the preferred method of having what you want now. The car or land is essentially owned during the term of the lease. Land leases of 99-years gives you a lot of time to enjoy life rather than accept nothing or have to wait just because you can’t “own” it. Heck, even the World Trade Center in NYC is on a 99-year lease. (Another reason to consider moving to the South Pacific)

I have had people tell me, smugly, that they would never invest in a lease property, only freehold. I know some of these same people did not have the money for freehold, so they may never experience what was certainly driving them; a life in paradise all the way to the beach below. The hard core demand for freehold dilemma is more mental and emotional than logical, given the price differences on exactly the same land.

South Seas living in The Kingdom of Tonga or Fiji demonstrates how life should be taken, with a laugh and with self-evident freedom beyond any land of the free. We are fine and enjoying what nature generously provided and what man has made too relaxed for the rigidly inflexible to enjoy. Life is good as it gets with no frets as a retired or independent resident on leased or freehold land.

Robert Bryce, retired in the south seas.