What is freehold vs leasehold?

Buying your first home and not sure what freehold and leasehold mean? Find out the major differences here.

Freehold vs Leasehold

If you’re buying a house, you may have heard of the terms freehold and leasehold. While these terms may sound complicated, they have two simple meanings:

  • Freehold – You own the property and the land it’s built on for as long as you want.
  • Leasehold – You own the property for a set period, but not the land it’s built on.

What is a freehold property?

What is a freehold property?

With a freehold, you own the house and the land it’s built on including outdoor spaces like gardens. There are no leases to consider, you won’t have to pay ground rent or any maintenance fees. Freehold is the most common way to buy a house in the UK.

What is a leasehold property?

What is a leasehold property?

Leasehold is where you buy the property, but not the land it sits on. The land is still owned by the freeholder, who is selling the property for a set period of time. It’s more common with flats, but there are leasehold houses too. 

Leaseholds usually last between 125 and 999 years. If you buy a leasehold property, you might be able to extend how long you own it for. Shared spaces, like gardens and hallways, are the responsibility of the landlord. 

This means if there’s any damage or work that needs doing, they will usually sort it out. You’ll pay them a service charge to cover this. You’ll also pay ground rent. 

Buying the freehold

Buying the freehold

If you’re living in a leasehold property, someone else owns the freehold. It might be possible to buy the freehold, but not always. 

At any time, you can ask to buy the freehold from the landlord. There’s no obligation for the freeholder to sell. 

Extending a leasehold

Extending a leasehold

What about properties with short leases? You can ask the landlord if they’ll extend the contract.

You might be able to extend your lease by:

Differences between a freehold and leasehold property

Differences between a freehold and leasehold property

Here are the key differences between freehold and leasehold properties: 

  • Property ownership – With freehold, you own the property and the land it’s built on. With leasehold, you own the property for a set period but not the land.
  • Gardens – With a freehold property, you own the gardens. It’s your responsibility to maintain them. With leasehold, you do not own the shared gardens. The landlord is responsible for maintenance.
  • Service charges – With freehold, there are no set charges but you are responsible for the property’s upkeep. With leasehold, you’ll pay ground rent and other service charges. 
  • Remortgaging – You can remortgage a freehold property. It can be tricky to remortgage a leasehold property. Most lenders generally want to see at least 70 years remaining on the lease.  

The content on this page is for reference and does not constitute financial advice. For impartial financial advice, we recommend government bodies like MoneyHelper.

Calculators and tools

Calculators and tools

We have a range of mortgage calculators to help you:

  • Find out how much you could borrow from Halifax
  • See how much you could save if you make overpayments on your mortgage
  • Get an idea how a change to the Bank of England Base Rate could affect your monthly payments
Use our calculators and tools

Speak to someone

Speak to someone

You can talk to us over the phone or use our mortgage video service from the comfort of your own home.

Contact us