There are two kinds of rights on a piece of land: (A) the owner
(lessor)'s right and (B) the leaseholder's right.
The total right on the property (C) = (A) + (B)
If the land is not leased, i.e., B = 0, then C = A.
Under the Japanese law, B can be substantial. See the annecdote
below.
Once I was leasing a tiny land on which I built our first house of
our marriage in 1962. It was a sublet from my wife's father. The
owner should have asked my father-in-law to terminate the lease
sooner. However, because it is owned among a group of people
and their relations were complicated, and my father-in-law had a
forsight, keeping it by paying the rent duely without any delay
each month although it was not used for years. The size of the
lot is just about enough to build a two car garage in the U.S.
Years later (1986? when I was living in US), a local bus company
wanted to purchase the lot in addition to other neighboring
properties
in order to build a dormitory for its employees. The owner agreed
to sell so that the bus company came to me asking me to give up
the leaseholder's right on the land on which a tiny house was built.
After negotiation through a lawyer, I agreed to give up the
leaseholder's
right. The house was of no practical value by then, so it was torn
down.
The leaseholder's right amounted to over 20 million yen. I don't know
how much was the land owner's right, i.e., 底地権. I believe that there
is a rule of thumb, like A:B = 60:40.
Minoru Mochizuki
>
japanesele...@gmail.com