In the UK, a leasehold property is one where the homeowner owns the property for a fixed period of time, typically 99 or 125 years, but the land on which the property is built remains owned by a freeholder. The leasehold property owner is required to pay ground rent to the freeholder, who is responsible for maintaining the land and any communal areas.
In contrast, a freehold property is one where the homeowner owns both the property and the land on which it is built. There is no time limit on ownership and no ground rent or other charges to be paid to a freeholder. The freeholder is solely responsible for maintaining the property and any surrounding land.
While leasehold properties can be more affordable than freehold properties, they come with additional costs and restrictions. Homeowners of leasehold properties must obtain permission from the freeholder for certain changes to the property, and may face difficulty selling or remortgaging the property if the lease length becomes too short.
