When investing in real estate in Curaçao, understanding the different types of land available is crucial. Each option Eigendomsgrond (owned land), Erfpachtgrond (leasehold land), and Huurgrond (rental land) has its own benefits and considerations.
In this blog, we’ll break down each land type, helping you make an informed decision for your real estate investment.
1. Eigendomsgrond: Full Ownership, Complete Control 🏡
Eigendomsgrond (owned land) offers the most straightforward and secure land ownership option in Curaçao. As the owner of the land, you have full control, allowing you to build, sell, or develop the property as you see fit.
Benefits of Eigendomsgrond:
- Complete Ownership: You hold the title to the land, which means no lease or renewal terms to worry about.
- Long-Term Investment: Ideal for building a family home, a vacation retreat, or long-term investment.
- Freedom to Develop: With eigendomsgrond, you have the freedom to create the property you envision, whether that’s a private residence or a commercial space.
- No Restrictions: As the full owner, you can pass the land on to heirs or sell it without needing approval from a government entity.
- Property Tax: The only ongoing cost associated with eigendomsgrond is the annual property tax (Onroerendgrondbelasting), which is generally lower than the additional fees associated with leasehold or rental land.
Who Should Consider Eigendomsgrond?
If you’re looking for long-term investment, stability, and the ability to make all decisions regarding the property, eigendomsgrond is the best option for you.
2. Erfpachtgrond: Affordable Leasehold Land 🌱
Erfpachtgrond is a long-term lease arrangement where the land is leased to you, typically for periods ranging from 30 to 60 years, with the possibility of renewal. While you don’t own the land outright, you have extensive rights to use, develop, and even sell the land during the lease term.
Benefits of Erfpachtgrond:
- Lower Upfront Costs: Unlike eigendomsgrond, erfpachtgrond is usually more affordable, with lower purchase prices or initial payments.
- Long-Term Security: The lease typically lasts for 60 years or more, offering stability for your investment or development plans.
- Development Potential: Ideal for residential or commercial projects, allowing you to build and improve the land.
- Mortgage Eligibility: One of the advantages of erfpachtgrond over huurgrond is that you can often qualify for a mortgage, making it easier to finance your project.
- Additional Costs: With erfpachtgrond, you are required to pay an annual fee in the form of Onroerendgrondbelasting (property tax), in addition to the canon (lease fee). The canon varies depending on the neighborhood and is typically recalculated periodically.
Who Should Consider Erfpachtgrond?
Erfpachtgrond is a great option for investors who want to secure land for development without the high cost of outright ownership, but still want long-term security and the potential for financing.
3. Huurgrond: Short-Term Land Rental for Flexible Use 🏢
Huurgrond (rental land) is a temporary solution, where land is rented for a set period. This option is perfect for businesses, construction projects, or temporary ventures that do not require long-term ownership.
Benefits of Huurgrond:
- Affordable & Flexible: Huurgrond is often cheaper than both eigendomsgrond and erfpachtgrond, offering an affordable option for short-term needs.
- No Long-Term Commitment: If you’re not ready to commit to a permanent land purchase, huurgrond provides flexibility with shorter leases.
- Quick Accessibility: Rental land is often easier to secure, allowing you to start projects or businesses without waiting for long-term approval processes.
- Used for Farming: Huurgrond is often leased for agricultural purposes, such as farming, where short-term land use is required without long-term ownership.
⚠ Important Note: Huurgrond is not eligible for a mortgage. If you want to secure funding, you’ll need to have the capital upfront.
Who Should Consider Huurgrond?
Huurgrond is ideal for those with temporary land needs, such as farmers, businesses looking for short-term solutions, or individuals needing land for a specific project that doesn’t require long-term ownership.
Which Land Type is Right for You?
Choosing between eigendomsgrond, erfpachtgrond, and huurgrond depends on your specific needs and financial situation. Here’s a quick guide to help you decide:
- Eigendomsgrond: Best for long-term investment and those who want complete control over the land.
- Erfpachtgrond: Ideal for those looking for a more affordable option with long-term security and the potential for mortgage financing.
- Huurgrond: Perfect for temporary needs or projects (including farming) that don’t require long-term ownership, but note that no mortgage financing is available for huurgrond.
Final Thoughts
Curaçao offers a variety of land options to suit different investment strategies, whether you’re seeking full ownership, an affordable leasehold, or short-term rental solutions. Understanding the differences between eigendomsgrond, erfpachtgrond, and huurgrond will help you make the right choice for your real estate needs.
If you’re ready to explore land options in Curaçao, contact me today for expert guidance and available listings that match your requirements.
