
Posted by

Leasehold vs freehold: what’s the difference


What’s the difference between leasehold and freehold? There are 23.36 million properties in England and Wales with 64% being owner occupied and 36% being rented either from a private landlord, local authority or housing association.

Over nine out of ten of those English and Welsh owner-occupied properties are a whole house or bungalow. Now, most people would assume they would be freehold – however, of those renting nearly half of rental properties, 44% to be precise, lived in other leasehold apartments and flats.

But what does it actually mean for a property to be leasehold?

When someone owns the freehold of a property they own it outright, including the land it is built on, whilst with a leasehold property, the leaseholder owns the property for the length of their lease agreement. Leaseholders must pay the person who owns land (the freeholder) ground rent and other fees.





What are the different forms of home ownership?

There are two fundamentally different forms of legal ownership: freehold and leasehold. Many people who don’t sort this out when they buy a home, getting it wrong can be hugely expensive.

What is freehold?


What is leasehold?

Leasehold means that you just have a lease from the freeholder, sometimes called the landlord, to use the home for a number of years. This tells you how many years you’ll own the property. Ownership of the property returns to the landlord when the lease comes to an end.

Leaseholder rights and responsibilities

Your responsibilities

Your lease will tell you what conditions you’ve agreed to, for example:

  • if you need permission to make alterations
  • how much you’ll have to pay to maintain the property

You have the right to:

  • get information about service charges or insurance
  • know the landlord’s (freeholder’s) name and address
  • be consulted about certain maintenance and running costs
  • challenge certain charges under some circumstances

Building insurance

Your landlord will usually be responsible for insurance of the building (not the contents) – this will be part of your service charge.

You have a right to: ask for a summary of the insurance policy and challenge the cost through a tribunal if you think it’s unreasonable


Unsure about how the leasehold details of a property your buyer, or want to know more about what leasehold means? Get in contact with us today.

Leasehold vs freehold: what’s the difference
By David Price