Salisbury Law Blog

Have you ever wondered what the difference is between leasehold and freehold property, and which is best for you?


If you intend to own a property, it is really important to know their difference, and which is your best option.


Leasehold and Freehold are both ways of owning a property, they are distinctly different and affect buying, owning, and selling the property.


We have outlined the pros and cons of both leasehold and freehold properties. This write-up will help you understand better and decide which will fit your needs.




Ownership of the land on which a property is built can be leased (Leasehold) from the government or developer for a certain period of time which may vary in the number of years.

The land on which an apartment in a housing complex is built might be leased.

The future of such properties after the lease period expires is usually a bit uncertain.

Maintenance and insurance charges may be billed on a leasehold property.

Also, lease contract may be renewed or not depending on the circumstances of the owner.


Advantages of Leasehold Property


1.  Leasehold properties are cheaper.

2.  The building owner can avoid maintenance costs and repairs since these properties are generally looked after by the owner.

3.  Provides land for people who need a house for a short period of time.

4.   A leasehold property has fewer responsibilities.


Disadvantages of Leasehold Property


1.  The leasehold property contract has to be renewed when it expires.

2.  The owner of the property is not bound to renew the contract and might terminate it.

3.  Service charges on the land depends on the owner and non-compliance may cause the owner to terminate the contract.

4.   The landowner may impose restrictions on the use of the land.




Freehold property is any real estate that is free from any entity other than the owner.

This means both the building and the land it stands on belongs to the same person in perpetuity.

The owner of the freehold may use it forany purpose in accordance with the regulations of where it is located.

Freehold land title refers to a property document that shows the owner of the land owns it for perpetuity.


Advantages of Freehold Property


A freehold property signifies complete freedom. The owner of the property has complete control over the property and there are no further payments like ground rents or service charges, unlike leasehold properties.

A freehold property has no restriction, and the owner can do whatever he legally wishes to within his property.

Disadvantages of freehold properties

The only disadvantage of freehold properties is that they are more expensive.

What You Need to Know



Leasehold is cheaper than freehold properties

Maintenance of the property lies on the owner

Leasehold properties have clear and verified titles.


Freehold property owners do not pay ground rent

Owners have complete ownership rights

No restrictions on its use

No restrictions on transfer

No renewal contract to worry about

Freehold sale requires less paperwork than leasehold

Transfer of leasehold may need authorization from the landowner.


Which Is Better for You, Leasehold or Freehold?


People prefer buying a freehold property as its prices increase more gradually as compared to leasehold properties.

Freehold offers more freedom and it's easier to get a mortgage, compared to Leasehold.

If you invest ina leasehold property, the ownership will remain with the developer or the state authority, sometimes renewing the lease may be problematic or impossible.



Converting Leasehold to Freehold


You can convert a leasehold property to a freehold if you meet some criteria.

You have the right under the Leasehold Reform Act 1967 to buy your freehold but you must be a qualifying tenant inorder to make a claim.

A freeholder might sell you the freehold without you having to make a formal claim, but you should always seek professional advice and get an idea of what the cost might be.




If you want to formally buy the freehold under the law, you maybe liable to pay the freeholder a reasonable legal and valuation cost.

Buying the freehold can be a complex process so we recommend you get professional help from a solicitor who is experienced in this area.

Salisbury Law conveyancing solicitors can help.


Contact us at

3 Fiddlebridge Lane, Hatfield, Hertfordshire AL10 0SP

(01707) 244 710

(01707) 240 455


March 24, 2021