In the UK, tenure defines how you own your property.
When buying a property, you will usually encounter 2 main types: freehold and leasehold. Each comes with different rights, responsibilities and long-term impacts, from what you own to ongoing costs.
Understanding these differences helps you make informed decisions before making an offer.
This article covers how freehold and leasehold work, their key differences, and what to check before buying.
What is freehold?
Freehold gives you complete ownership of both the property and the land beneath it, with no time limit on how long you can hold it. No higher freeholder sits above you, and no lease agreement looms in the background.
Most houses in the UK are sold as freehold. This means you are responsible for the building, the roof, the boundaries, and all repair costs.
If you are an investor, freehold offers a high degree of control. You decide when to renovate, and you do not need permission from anyone else to let the property to tenants.
What is leasehold?
Leasehold means you own the property for a set period, while the freeholder owns the land. The lease agreement sets both the term and the rules you must follow.
Most UK flats are leasehold, as someone needs to maintain shared areas like the roof and stairwell.
The lease term shortens over time. For instance, a 125-year lease from 1990 has about 89 years left in 2026, and that term transfers with the property when sold.
Your lease also limits what you can do. Many require the freeholder's written consent to sublet, which matters if you plan to let the flat.
A middle option is share of freehold. Flat owners jointly own the freehold through a company.
With share of freehold, owners set ground rent and manage service charges together. However, you still have a lease, so the unexpired term remains crucial.
Freehold vs leasehold: what are the key differences?
Five key areas change depending on whether you buy a freehold or leasehold property:
Most differences after the first mean extra cost or less control. That is why you must read the specific lease. The details decide your rights, duties, and expenses.
How do you check if a property is freehold or leasehold?
To confirm the tenure, start with the free HM Land Registry Property Summary.
If the property is leasehold:
- You can buy the Title Register for £7. It shows the title number, owner details, and lease information.
- For legal proof, request official copies by post.
- Work out how many years are left on the lease, as lenders care about this. Property listings usually show the original lease length. For example, a 99-year lease from 1978 will have 51 years left in 2026.
If the property is freehold, there is no lease countdown, ground rent, or service charge. Still, you should read the register because some rules might limit how you can rent out the property.
Also, watch out for freehold flats or flying freeholds, where part of your property is above or below someone else's. Many lenders will not accept these, so check their rules before you make an offer.
Can you get a mortgage on a leasehold property?
Yes, you can. Many UK buy-to-let mortgages are secured on leasehold flats. Tenure is usually not the problem.
The main issue is the lease's unexpired term.
Lenders require the lease to last longer than the mortgage. However, they do not all agree on how much longer is enough:
- Some lenders set a minimum number of years remaining at the start, often between 70 and 85 years.
- Others require a certain period to remain after the mortgage ends.
For this reason, check each lender's handbook before you make an offer. A lease that meets one lender's rules may not meet another's.
If you are a non-resident, you will have a shorter list of lenders to choose from. The criteria for borrowing on a UK buy-to-let from overseas become stricter when the security is less certain.
How long is the lease, and why does the number matter?
The number of years left matters because once a lease drops below 80 years, it usually costs more to extend and is harder to sell.
The main issue is marriage value, which is the extra value added when you extend the lease.
Right now, if the lease has less than 80 years left, the freeholder can claim 50% of that extra value, which can make the extension much more expensive.
The Leasehold and Freehold Reform Act 2024 aims to abolish marriage value and introduce 990-year lease extensions, but these changes are not yet in effect.
So for now, if you extend a lease with less than 80 years left, marriage value still applies. Waiting can cost you more. For example, a lease with 82 years left now will have only 79 in three years, which could raise the price.
If the lease term falls too low, lenders may refuse to offer a mortgage. At that point, the property becomes unmortgageable until you extend the lease.
What does a leasehold cost you every year?
There are 2 main charges, and neither is as predictable as it may seem.
Ground rent is the annual payment to the freeholder for the land. For leases granted since 30 June 2022, this is usually a peppercorn ground rent, which means you pay nothing in practice.
Older leases often charge £250-£400 per year. Use this range as a reference, but some leases include doubling clauses or inflation-linked rents, which can increase costs over time.
Service charge is usually the larger expense. It covers building insurance, communal repairs, and management. For a small purpose-built flat, this might range from £1,000-£3,000 per year. London blocks with lifts or major cladding works can be much higher.
Consider a £250,000 leasehold flat rented at £1,200 per month:
What is more important is what those numbers do not include:
- Section 20 major works: The freeholder can charge each flat four or five figures in one year for things like a new roof, lift, or cladding. If the savings fund is too small, you might get a big bill to catch up.
- Voids: Months with no tenant and no rent.
- Agent fees and repairs inside the flat: The service charge covers the building, but anything inside your flat is your responsibility.
- Insurance excess: You still have to pay this even if the building's insurance covers the claim.
So, set aside money for major works when you budget for the flat. This year's service charge only covers this year and does not predict future costs.
What should you check before you make an offer?
There are 7 key checks to carry out on paper before you commit:
- Tenure: The free HM Land Registry property summary confirms freehold or leasehold.
- Unexpired term: Count the years remaining today, then check that figure against the lender's minimum.
- Ground rent clause: Check the review mechanism and the current figure. A doubling clause is a financing problem.
- Service charge accounts: Ask for the last three years. The trend tells you more than the number.
- Section 20 notices: Any consultation underway or recently closed means a bill is coming.
- Subletting clause: Confirm you can let the flat, and whether you need consent each time.
- Share of freehold: Check whether the block owns its freehold, and whether you buy into that company.
If the seller cannot produce the service charge accounts, treat that as an answer.
Is it better to buy freehold or leasehold?
The answer depends on your goals and the numbers:
- Buy a freehold house if the numbers add up. You avoid service charges and control repairs and costs.
- Consider a leasehold flat only after thorough checks and setting aside money for major works. City-centre flats can offer better returns, but leasehold is the entry price.
- Avoid leases under 80 years unless the price covers extension costs and you know who pays. Below 80 years, marriage value applies, and discounts rarely cover the extra bill.
Keep your completion on track when the lease delays a lender
Lease issues often appear late. The valuer may flag the unexpired term, or the lender might request an extension just before completion.
A bridging loan buys time, but it does not fix a short lease, high service charges, or strict subletting clauses. These stay on the title after you buy.
What bridging changes is the deadline. You can sort out lease paperwork after completion, so timing is no longer a reason to lose your deposit.
At GoGoProp, we lend at 1% per month with a 2% handling fee, up to 75% LTV, over 3- to 12-month terms on residential buy-to-let in England and Wales. We approve in 24 hours and fund in as little as 10 days.
If a lease query is holding up your purchase, check what bridging would cost on your deal:
GoGoProp lends under Money Lender's Licence No. 1341/2025.
Key takeaways
- Freehold means you own the building and land with no time limit, which is the case for most UK houses.
- Leasehold means you own it for a set period, which is common for most UK flats.
- HM Land Registry tells you the tenure for free, and the title register costs £7. Listings show the original lease term, so subtract to see how many years are left.
- Lenders set their own minimum number of years left on a lease, and these can vary a lot.
- Marriage value still applies if the lease has less than 80 years left.
- Service charges are not a fixed yearly cost. Section 20 works can mean you get a bill for thousands of pounds in a single year.
- A bridging loan keeps a purchase on schedule when a lease query stalls the mortgage; then you extend the lease and refinance.
Frequently asked questions
1. Do you own the property if it is leasehold?
You own the property for as long as the lease lasts. Someone else owns the land, and when the lease ends, the property returns to them.
2. Is a 999-year lease as good as freehold?
Almost. A 999-year lease is so long that it will not run out in your lifetime. You still have to pay a service charge and get permission for major changes.
3. What happens when a leasehold expires?
The property goes back to the landowner, and you lose ownership. Most people extend the lease long before that happens, since the property loses value as the years go down.
4. Is leasehold going to be abolished?
No. The plan is to stop new leasehold flats and make commonhold the standard instead. Existing leases will stay as they are.
5. Can you be kicked out of a leasehold property?
It is rare, but it can happen. If you breach the lease terms or fail to pay what you owe, the freeholder can try to end the lease. Courts only allow this as a last resort.
