Leasehold
Leasehold is a type of property ownership in which you only have the rights to live in a particular property for a specific amount of time. The term is used to describe both residential and commercial properties.
In a residential situation, the tenant is usually living in the building, while the freeholder is a company or person who owns the building and manages it. They rent the space to the tenant for an agreed period of time in exchange for a series of monthly payments, often called ground rent.
There are two types of Leasehold Services: a tenancy for years and a periodic tenancy. The lease for a tenancy for years is the longest and most common. The tenant can choose to extend the lease at the end of the period.
What Do You Mean by Leasehold?
If you are considering buying a leasehold property, it is important to know your options. You should speak to a specialist conveyancing solicitor and discuss the different options that are available to you before you commit to purchasing your new home.
The cost of a leasehold purchase can be expensive, and it is important to make sure that you understand what you are buying before you buy. You should also take into account any service charges that you may need to pay and the possibility that these costs could increase over time.
When you buy a leasehold property, you will need to pay a fee to the freeholder to cover the maintenance of the buildings, gardens and communal areas. This fee is usually charged on an annual basis and it can be very expensive, so you will need to budget for this.
You should ask your conveyancing solicitor to explain how this fee works and how you might pay it in the future if you wish to extend the lease. You should also think about whether you will be able to afford to pay it in the future if you decide to sell your property.
Some older people who are on a fixed income and looking for a low down payment option may find a leasehold interest an attractive option. It can be a cheaper alternative to a freehold property, and it can give you the ability to increase your rent on a set basis for decades.
Leaseholds are more popular in flats and apartments, but they are increasingly being sold on new-build homes in England, Wales and Northern Ireland. The UK government is trying to stop the practice of selling new build leaseholds because it believes that housebuilders are unfairly treating their leaseholders.