If you own the freehold of your home, it implies that you own the building and the land it sits on. If your residential or commercial property is leasehold, you own the residential or commercial property but not the building or land and need to pay ground lease to the freeholder.
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Freehold vs leasehold: the essential distinctions

Do you comprehend what is indicated by a freehold or leasehold residential or commercial property? Experienced estate representative, Ian Harris helps describe the key differences.

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What does leasehold mean?

You are buying a lease from the freeholder for the right to reside in the residential or commercial property for a set variety of years. You will not technically own the residential or commercial property outright, the freeholder (or landlord) will continue to own the residential or commercial property and the ground it sits on. Leasehold is prevalent when purchasing a flat or house as it sits within a bigger structure.

The number of leasehold houses has however grown over the last few years, specifically with brand-new builds that are offered straight through the developer.

Recent changes to the law

The Leasehold and Freehold Act 2024 is now law, however individual parts of the Act are being executed one at a time so not whatever has actually been done yet. You can see the development of the modifications here. Eventually there will be a restriction on the sale of new leasehold flats, making Commonhold the new default tenure rather, where each unit-holder owns the freehold of their home.

Find out more about what's altering for leasehold

Main point to know that have been carried out so far are:

- If you own a flat, you can now extend your lease without waiting two years first (as of January 2025).

• This suggests that more leaseholders in mixed-use structures can make an application for the right to handle