Before purchasing a residential or commercial property in the UK, understanding the type of residential or commercial property ownership - whether it's freehold or leasehold - is very important. These terms might sound like legal lingo, but they can affect your responsibilities, costs and long-lasting strategies.

In this guide, we'll explore the nitty-gritty of freehold and leasehold residential or commercial properties, so you do not have to. We'll explore everything from what they indicate, their advantages to how they differ in terms of expenses, resale worth and legalities.

What is a freehold?

In simple terms, if you own a residential or commercial property on a freehold basis, you own the building and the land it rests on. There's no time limitation on your ownership, and it's all yours.

Responsibilities of a freeholder

Being a freeholder features amazing perks! You're basically the captain of your residential or commercial property ship which indicates you're responsible for the upkeep of the residential or and the land. You also have the liberty to make upgrades to your pad without requiring permission from a landlord. It's your area to shine!

What is a leasehold?

Having a leasehold indicates you own the residential or commercial property however not the land it's constructed on. You have a lease with the freeholder (usually a 'landlord') for a number of years, decades or even centuries. The length of the lease is necessary, as it can impact your ability to sell the residential or commercial property in the future.

Responsibilities of a leaseholder

As a leaseholder, you may have to pay ground rent to the freeholder, along with other charges like service charge for maintenance of typical locations. You may be limited in what modifications you can make to your home.

Types of leasehold residential or commercial properties

Typically, flats and maisonettes are offered as leasehold residential or commercial properties. Some houses can likewise be leasehold, generally through shared ownership plans. But make certain to check the length of the lease when thinking about these kinds of residential or commercial properties.

Differences in between freehold and leasehold

Ownership of land - in freehold, you own the land, whereas in leasehold, the land comes from another person. This difference is among the main distinctions and typically a game-changer for lots of homebuyers. Duration of ownership - think of freehold ownership as an unlimited adventure