Freehold and Leasehold

What’s the difference?

There is a lot of confusion between the two but the difference is essentially this:

  • The owner of a freehold property essentially owns the land and the buildings that stand on it.
  • The owner of a leasehold property only owns the buildings on the land and not the land itself.

This means they own a lease on the land and are responsible for paying ground rent to whoever owns the freehold.

The lease is a deed (a legal agreement) and is usually accompanied by conditions that both sides must stick to.

You are also required to maintain the property in good order and to fully insure it.

Those conditions usually include a right of access for the landlord and a list of things the leaseholder is not allowed to do, or things the leaseholder must obtain written permission from the land owner before doing.

You will find more information about the conditions on your lease on this page: Lease conditions.