One of the most asked questions when buying a home on Lake Burton, Rabun or Seed is "What's a lease lot?"
Unlike the majority of property you will likely ever own which are fee simple, a large portion of the land surrounding the lakes in Rabun County is owned by Georgia Power Company (GPC), and Georgia Power leases the land lot to the homeowner. The home itself is not owned by Georgia Power, just the land it sits on, the owner owns the home and any structure on top of the land.
There are four important factors to remember if you're interested in a property that is on a lease lot:
Georgia Power leases run for 15 years and are renewable.
Georgia Power charges a tiered lease fee during each 15-year period, gradually increasing every 5 years.
Georgia Power charges a transfer fee each time a lease lot property exchanges hands. Fees vary based on lake, property and the last time the lease was renewed - typically ranging anywhere from $7,000-$20,000.
Since you do not own the land, just the home & any structures on top of the land, your property taxes will be just for the home however, Georgia Power will assess you for the land tax cost they incur on the property.
Georgia Power uses the leases as a revenue stream and a way to manage, maintain and set guidelines that must be followed in order to preserve the lakes and shoreline. When you decide to purchase a Lake home in Rabun County make sure your real estate professional is aware of what the lease lots mean and how they can effect your lending capabilities (not every lender will approve a mortgage on a lease lot).
Also keep in mind that who pays for the transfer fee can, and should be, negotiated during the home buying process. When you start your searching for homes on Lake Burton, Lake Rabun or Seed Lake often, but not always, you'll be able to tell if a property is fee simple or a lease lot by how close your neighbors are.
It's also important to note that if you plan on turning your new lake home into a vacation rental, Georgia Power frowns on short-term renting on lease lots, since you own the home and the land with a fee simple property you can turn a fee simple Lake Burton, Lake Rabun or Seed Lake home into a vacation rental if you like.
If you're considering a Lake House in Rabun County make sure you work with an experienced Realtor like Cody that knows the ins and outs of lease lots, has relationships with lenders who you can work with and knows what you need to do - and know - to prevent any surprises.
