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Difference between Leasehold and Freehold

Sounds like technical legal term right! A few are more crucial to your house than wondering whether it’s freehold or leasehold. Basically, there’re two different forms of legal ownership; freehold & leasehold.

What is Freehold?

For those of you who own the freehold property, you actually are the solo-owner of that entire property with all the rights. Your name will be there in the registry as the freeholder owner the ‘title absolute’. You know what! When it comes to property buying, most of the people get along with the freehold option that you just can’t go wrong with at any cost. The reasons for this are mentioned below;

  • There’s no need to pay the annual ground rent as you own it all by yourself
  • You don’t need to mess up with a freeholder for regular maintenance or charging extra
  • The freeholder is responsible for maintaining the building fabric along with roof & the outside walls

Keep in mind that people usually prefer to buy freehold apartments in UAE. Frankly, there’s no need for a standalone house to go on a leasehold though. But nowadays some people are more inclined towards the new trend for leasehold houses especially when it’s a new build home. SO just make sure you check everything before putting your money into it.

What is leasehold?

This is when you get a lease from a freeholder, who’s actually the landlord. According to that lease, you are allowed to use the home for a few numbers of years. Most of the time, the lease are for the long term like 90 years, 120 years and it even goes up to 999 years. Frankly, it’s as good as enjoying the property as your own for the lifetime – it’s like a person will last but lease won’t. But with lease agreements, here’re a few legal things that need to be considered;

  • The leaseholder & Freeholder are bound under a contract that mentions all the legal right as well as responsibilities of either side.
  • There’re a few common parts of the building that a freeholder is responsible for maintaining entrance, staircase, exterior walls and roof etc.
  • On a flip side, leaseholders might claim their rights to manage. In that case, leaseholder will be responsible for managing the property.
  • The maintenance fees, annual service charges and certain fraction of the buildings insurance will be paid by the leaseholder.
  • Leaseholder will be responsible for paying the annual ground rent to the freeholder.
  • In case the leaseholder wants to get some significant renovation or maintenance works done to the property, he/she will have to take permission first.
  • Leaseholders might even come across other restrictions like not owning pets, etc.
  • In case the leaseholder fails to fulfil the lease terms, the lease will become forfeit.


Do you want to learn the difference between freehold and leasehold property? There’s a detailed information mentioned in the article about these along with their advantages. Just check out the article now.


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