Freehold and Leasehold

Freehold and Leasehold

Real estate agents and solicitors frequently use the terms Freehold and Leasehold. These are terms that one will encounter when their on the hunt for a new property. In this blog piece we will explicitly differentiate between freehold and leasehold properties.

Freehold Vs Leasehold: What is the difference?

Having a firm grasp of whether a property you intend to buy is freehold or leasehold is of utmost importance. The difference between the two comes with different connotations and thus knowledge of the property type become crucial.


Freehold property ownership refers to outright ownership of the property and the land on which it stands. Owning a freehold property enables you to be named as the “freeholder” on the land registry, as well owning the “title absolute”. Freehold property ownership is usually always the preferred option: you really can’t wrong with it.

Advantages of freehold property

  • The property owner is not required to pay any ground rent or service charges as they own the land the property sits on.
  • Land acquired through this means can be used for any means.
  • Freehold property can be used as collateral for loans.

Disadvantages of freehold property

  • Acquiring property through this means is increasingly expensive.
  • The freehold property owner owns the entirety of the property and land and therefore responsible for any maintenance on the property and land.


With leasehold property ownership you own the property and its land for the length of your lease agreement with the owner or freeholder. After the length of the lease the ownership of the property reverts back to the freeholder. In essence under a leasehold property you have temporary occupancy of the land the house sits on.

Advantages of leasehold property

  • The property occupant has less responsibility for repairs and maintenance.
  • Ideal for short-term residential needs.
  • Easy to enforce covenants.

Disadvantages of leasehold property

  • Property under leasehold cannot serve as security for loans.
  • At the lease expiration the tenant will have to approach the landlord again for a renewal of lease.
  • The freeholder has control over the amount of service charges and the costs of those charges.

There exists a distinct difference between freehold and leasehold properties. It is imperative that one has a profound appreciation of the difference and the associated costs, responsibilities, pros and cons of owning each of the property types. For any real estate related issues please feel free to contact our knowledgeable staff at Be Forward Real Estate.

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