Option A
Freehold
Freehold means you own the property and the land it stands on, subject to planning rules and normal legal restrictions.
Freehold vs leasehold: what is the difference?
Updated June 2026 9 min read
Quick verdict
Freehold is usually simpler because you own the property and land outright. Leasehold is common for flats and can be acceptable, but you must understand lease length, service charges, ground rent, permissions and management before buying.
Option B
Leasehold
Leasehold means you own a time-limited lease and may pay service charges, ground rent or permission fees under the lease terms.
Side-by-side comparison
Freehold means permanent ownership of the property and land. Leasehold means owning the right to occupy for the remaining lease term, with a freeholder owning the land or building structure. Leasehold can be workable, but the details matter.
Own the land
Freehold
YesBetter
Leasehold
No
Ownership duration
Freehold
PermanentBetter
Leasehold
Fixed lease term
Service charges
Freehold
Usually noBetter
Leasehold
Often yes
Lease extension
Freehold
Not neededBetter
Leasehold
May be needed
Typical property
Freehold
Most houses
Leasehold
Many flats
Best for
Freehold
Simple ownership
Leasehold
Flat ownership where terms are strong
| Compare | Freehold | Leasehold |
|---|---|---|
| Own the land | YesBetter | No |
| Ownership duration | PermanentBetter | Fixed lease term |
| Service charges | Usually noBetter | Often yes |
| Lease extension | Not neededBetter | May be needed |
| Typical property | Most houses | Many flats |
| Best for | Simple ownership | Flat ownership where terms are strong |
Pros and cons
Freehold pros and cons
Pros
- ✓Simpler ownership
- ✓No lease running down
- ✓No ground rent
- ✓Usually easier to sell and mortgage
Cons
- -Often costs more upfront
- -You handle all maintenance
- -Shared areas can still be complex in some setups
Leasehold pros and cons
Pros
- ✓Often the main route to owning a flat
- ✓Can cost less upfront
- ✓Building maintenance may be managed collectively
- ✓Share of freehold can improve control
Cons
- -Service charges can rise
- -Lease length affects value and mortgageability
- -Permissions may be needed
- -Lease extension can be expensive
Cost examples
Flat with long lease
A long lease with transparent service charges can be acceptable, especially where flats are the main available property type.
- Key check
- Lease length
Short lease
A shorter lease can create mortgage and resale issues, so extension cost should be understood before offering.
- Key risk
- Extension cost
Freehold house
For houses, freehold is generally the cleaner and preferred ownership structure.
- Likely fit
- Freehold
When to choose Freehold
- ›You are buying a house
- ›You want simpler ownership
- ›You want fewer ongoing third-party charges
- ›You may renovate or extend
- ›You want a cleaner resale position
When to choose Leasehold
- ›You are buying a flat
- ›The lease is long
- ›Service charges are clear and reasonable
- ›Ground rent is nominal or peppercorn
- ›There is share of freehold or strong resident control
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Use calculatorFAQs
What does leasehold mean?
Leasehold means you own the right to occupy a property for the remaining lease term, while the freeholder owns the land or building structure.
Is leasehold being abolished?
Leasehold reform is ongoing and new leasehold houses have been restricted, but flats in England and Wales are still commonly leasehold.
Why does lease length matter?
A shorter lease can reduce value and make mortgages harder to obtain. Extension cost becomes a key part of the buying decision.
Is share of freehold better?
It can be better because leaseholders have more control over the building, but you still need to understand management responsibilities and costs.
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