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Understanding the difference between leasehold and freehold is essential when buying a property in the UK. The type of ownership affects your rights, responsibilities and costs. In simple terms, leasehold vs freehold refers to two different ways of owning property. With freehold, you own the property and the land it stands on indefinitely. With leasehold, you own the property for a fixed period but not the land. Here’s what you need to know...
KEY INFORMATION
| Freehold | Leasehold | |
|---|---|---|
| Ownership | You own the property and the land it’s built on | You own the property for a fixed period but not the land |
| Length of ownership | Indefinite – ownership lasts forever | Fixed lease term, often 90, 125 or up to 999 years |
| Typical property type | Houses | Flats |
| Maintenance responsibility | You are responsible for maintaining the property | Freeholder manages maintenance. Leaseholders pay for it via service charge |
| Control over property | Full control | Restrictions set out in lease |
Key takeaway: The main difference between leasehold and freehold is that freehold means owning the property and land indefinitely, while leasehold means owning the property for a fixed number of years under a lease agreement with a freeholder.
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There are two main types of property ownership in England and Wales: freehold and leasehold. The way a property is legally owned is known as “tenure”.
Understanding leasehold vs freehold in the UK helps you know exactly what you’re buying and what responsibilities come with it.
This matters because the tenure of a property affects:
In general, houses are usually freehold and flats are usually leasehold, although there are exceptions.
Owning a freehold property means that you own the building and the land it stands on outright and indefinitely.
In other words, freehold ownership has no time limit. Once you buy the property, it belongs to you until you sell it.
Freehold is the most common form of ownership of houses in the UK and is the most straightforward type of property ownership. However, there are some leasehold houses, jump to more on this. So check the tenure of your property before you buy.
If you own a freehold property:
A leasehold property means you own the property for a fixed period of time but do not own the land it sits on.
Instead, you have a legal agreement called a lease with the freeholder, which sets out how long you own the property for and the rules you must follow.
Lease terms are usually long, commonly between 90 and 125 years, although some leases can be as long as 999 years. However, some leases are much shorter, read on for why the length of lease is important.
Leasehold properties are most commonly flats; if you’re looking to buy a flat in England and Wales then it is 9 times out of 10 likely to be sold as a leasehold.
If you buy a leasehold property:
When the lease expires, the property goes back to the freeholder. However, you can usually avoid this by extending the lease.
In most cases, freehold is the preferred option.
That is because freehold ownership gives you indefinite ownership, more control and fewer ongoing complications. You do not have to worry about a lease running down, paying leasehold charges or dealing with a freeholder.
However, that does not mean leasehold is always a bad choice. Many people happily own leasehold flats, and if you want to buy a flat, you’ll find the vast majority are leasehold.
The key question is not simply whether a property is leasehold or freehold, but whether the leasehold terms are reasonable. A well-run leasehold flat with a long lease and reasonable charges may still be a good purchase.
Another ownership structure you may come across when researching leasehold vs freehold is share of freehold.
Share of freehold means you own your flat on a leasehold basis, but also jointly own the freehold of the building and the land it stands on.
Having a share of freehold can give residents greater control over how the building is managed and can make lease extensions easier.
However, owning a share of the freehold also means that the leaseholders must work together to manage the building, which can sometimes lead to disagreements if owners have different priorities. Read more in Share of freehold explained
For many buyers, these are the reasons why freehold is generally preferred.
The disadvantages of buying leasehold property can include:
Buying a leasehold property has drawbacks, but that does not automatically mean leasehold is a bad option.
Leasehold properties are common, with 19% of English housing stock consisting of leasehold properties, according to government data. And many people own and live happily in leasehold flats.
As with most things, the devil is in the detail.
A leasehold property becomes more risky when:
So if you want to buy a property, and it’s leasehold, the real issue is whether it is a good leasehold. This is why it’s important to choose a conveyancer who is experienced in leasehold properties.
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When you buy a freehold property, you’ll own it in perpetuity. But this isn’t the case with leasehold properties, which is why lease length is so important.
If a lease has too few years left, it can affect:
As a rule of thumb, once a lease falls below 85 years, mortgage options may be more limited.
Once a lease drops below 80 years, it’s considered a short lease. Under current rules, the lease extension process suddenly gets more expensive due to ‘marriage value’. This is because, at this point, when you extend your lease, you must pay half of the amount the property will theoretically increase in value by due to the longer lease – this is known as marriage value.
The Leasehold and Freehold Reform Act 2024 abolished marriage value, but this has yet to come into effect. Until it does, the current rules still apply. Find out more in our guide on leasehold reforms.
This is one of the biggest financial differences when comparing leasehold vs freehold property ownership.
A common question is whether 999-year leasehold vs freehold really makes much difference.
A 999-year lease is extremely long and, in practical terms, may feel very similar to freehold. For example, there may be little immediate concern about the lease term running down.
However, a 999-year lease is still leasehold, not freehold.
That means:
Houses should usually be freehold.
That said, leasehold houses do exist, particularly in some new build developments and in certain parts of the country.
In recent years, the proportion of new build leasehold houses has fallen sharply following pressure for reform and changes in law and developer practice.
So while most houses are freehold, you should never assume. Always check the title documents or ask your conveyancing solicitor to confirm the tenure.
Problems with leasehold houses may include:
The Leasehold and Freehold Reform Act 2024 has effectively banned the sale of leasehold houses in England and Wales (other than in exceptional circumstances).
Although the number of new leasehold houses for sale started to decline dramatically in recent years as it became apparent that they would be banned:
The banning of the sale of leasehold houses is something we called for, including in our report Homes Held Hostage.
But these changes were not retrospective which means there are still leasehold houses in the UK today.
If you are thinking about buying a leasehold house, you should be especially careful to check:
If you are considering buying a leasehold property, some of the key aspects you’ll need to know include:
You can ask the estate agent for some of the information at the outset. But don’t rely on what they say as they could be wrong.
Always get your conveyancing solicitor to confirm these details. Read more in our guide Leasehold conveyancing: Fees, process and how long it takes
When the term of the lease drops to zero years, the leasehold expires and the property reverts to the freeholder.
However, in reality, most leases don’t expire because they are extended well before the lease runs out. But this doesn’t happen automatically. So it’s important to find out how long is left on your lease and take action, if required. Read What happens when a leasehold expires?
Get expert advice on whether now is a good time to extend your lease or buy your freehold
In some cases, yes.
Get expert advice on extending your lease, buying your freehold or applying for the right to manage.
Leaseholders of flats have a joint right, with other flat-owners in the block, to buy the freehold of their building. This is known as a right of “freehold enfranchisement” and it means that the leaseholders become their own freeholder.
However, you can’t buy the freehold of your flat by yourself. You have to get your neighbours involved too. The law allows at least half of the leaseholders to come together to buy the freehold of the block from the freeholder/landlord.
If you own a freehold house, you have a legal right to force your freeholder to sell you the freehold of your home. For more details, see our advice guide Should I buy the freehold? It’s advisable to get expert advice on whether now is a good time to buy your freehold.
In terms of costs to buy your share of the freehold you will need to pay your flat’s share of:
The exact cost depends on the size and value of the building, the lease lengths involved and the premium payable to the freeholder.
Get expert advice on extending your lease, buying your freehold or applying for the right to manage.
Unlike if you buy a freehold property, buying a leasehold property involves paying additional costs.
The main leasehold charges are:
These costs can make a significant difference to affordability, so buyers should understand them clearly before committing.
KEY INFORMATION
However, whether you buy a freehold or leasehold property, you may need to pay estate management charges for the upkeep of shared spaces.
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It is common to have tension between freeholders and leaseholders. Such as:
The Property Ombudsman said it received 6,649 enquiries about residential leasehold in 2024, a 67% year-on-year spike with many homeowners concerned about the fairness of service charges, which in most cases must be redirected to a court or tribunal.
An absent freeholder can also cause problems, including issues if you want to extend your lease or buy the freehold, to selling your property down the line. Read more in our guide to Absent freeholder problems
Freeholders complain leaseholders breach the terms of their lease. For example, by making too much noise or not getting permission for building works.
The answer is: sometimes, but not always.
A leasehold property may be harder to sell if:
But many leasehold flats sell perfectly well, especially where the lease is long and the charges are reasonable.
Another term you may come across is Commonhold, which is designed to be an alternative, fairer form of tenure to leasehold.
With commonhold:
Under plans set out in the government’s 2026 Draft Commonhold and Leasehold Reform Bill, new leasehold flats will be banned and commonhold will become the default tenure. The draft Bill also includes measures that will allow you to switch an existing leasehold home to commonhold.
However, while these reforms will make commonhold the default tenure in the future, leasehold remains the main form of tenure for flats in the UK. Bookmark our page on Leasehold Reform to stay up to date on this.
These three arrangements can sound similar, but they are not the same.
Get expert advice on extending your lease, buying your freehold or applying for the right to manage.
Get expert advice on extending your lease, buying your freehold or applying for the right to manage.
Freehold is pretty much always the preferred option. With freehold, you own the building and the land it stands on indefinitely. But with leasehold, you own the property, not the land, and only for the length of your lease agreement with the freeholder. Plus, you’ll need to pay leasehold charges too.
There are lots of downsides to buying a leasehold property, but if you’re buying a flat, you’ll probably find most of the flats on the market are leaseholds. The key is to be fully aware of the length of lease, any leasehold charges and any other important factors that your conveyancer should flag to you. Read more in our guide on Buying a leasehold property.
To find out whether your house is freehold or leasehold, you should check your deeds. Alternatively, you can search for your property at the Land Registry.
A flying freehold is a freehold property built over land that doesn’t form part of the property, such as if a freehold property overhangs another. For example, this could include rooms built across passageways or basement vaults.
The difference between freehold and leasehold is that freehold means owning the property and land indefinitely, while leasehold means owning the property for a fixed number of years under a lease agreement with a freeholder.
Freehold means you own the property and the land it stands on outright, with no lease term and no expiry date.
Leasehold means you own the property for the length of the lease, but not the land it stands on. When the lease expires, ownership reverts to the freeholder unless the lease is extended.
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