Leasehold vs Freehold: Key Differences Every Buyer Must Know
Leasehold means you own the property for a fixed number of years, while Freehold grants outright, perpetual ownership of both building and land.
Buyers confuse them because glossy brochures rarely say “expires in 89 years.” First-time owners focus on granite counters, not ground rent clauses buried in legalese.
Key Differences
Freehold: zero ground rent, full control, sells fast. Leasehold: annual fees, lender scrutiny, value drops as lease shortens, costly extensions.
Which One Should You Choose?
Pick freehold if you crave autonomy. Accept leasehold only when the lease exceeds 100 years, service charges are capped, and purchase price compensates for future extension costs.
Examples and Daily Life
Your aunt’s £300k flat is leasehold—she just paid £8k to add 90 years. Your cousin’s £300k house is freehold; he only worries about mowing the lawn.
Can a leasehold flat become freehold?
Yes, via collective enfranchisement if 50% of leaseholders agree, but expect legal and valuation costs.
Does a short lease affect mortgages?
Lenders rarely finance leases under 70 years, or they hike interest rates to offset risk.