§171-79 Purchase of fee title by lessee. At any time after the requirement of construction of a residence upon the premises has been fulfilled and after ten years from the date of the issuance of the lessee's residential lease, any residential lessee who is financially able to purchase the fee title to the premises demised to the lessee by the lessee's residential lease may, if not in default under the terms of the lessee's lease, purchase the fee title at its fair market value determined as of the date of the exercise of the lessee's option to purchase. The fair market value shall be determined by appraisers and shall exclude the value of improvements erected by the lessee and shall be determined as if the premises were not subject to the residential lease or to any mortgage made by the lessee. The patent or deed issued upon purchase shall state that within the ten-year period following the date of issuance of the patent or deed, the land or any interest therein shall not, without the written consent of the board of land and natural resources, be sold, leased, or otherwise transferred to any person disqualified under sections 171-74 and 171-75, except that the lessee may mortgage the premises and improvements, without the board's consent, to recognized lending institutions, which mortgage may be freely assigned by the mortgagee and the fee title sold to any person or corporation or agency of government at or after foreclosure. [L 1962, c 32, pt of §2; Supp, §103A-75; HRS §171-79; gen ch 1985]
Case Notes
Fee simple interest may be purchased under §171-99(a) by payment of "fair market price", which, under this section and §171-99(a), requires appraisers to ignore both the value of improvements erected on the premises and the lease encumbrances. 85 H. 217, 941 P.2d 300.