Difference Between Leasehold and Freehold
The terms freehold and leasehold are connected with buying and selling of properties. Gernerally these terms are confused with other for a new person in the field. Often people are not able to distinguish between freehold property and leasehold property. They cannot decide which one they should buy. Each of these type of properties has its own negative and positive points. Lets discuss both these types of properties to find the difference between them.
Buying freehold property entitles you to become the sole owner of the property. You can modify, construct and sale it again as per the rules whenever you like. Not body has claim on it except you. Therefore, most of the people prefer buying a freehold property rather than leasehold one. But it has one disadvantage too. You have the sole responsibility of repairing if any required.
In Leasehold deal of a property not the actual property is sold. Rights of using a property are sold. If you buy a leasehold property, you will have complete write to live there and use it but you will not be able to sell it. The lease is set for a period of time. You are not the real owner of the property. Mostly flats are on lease and the resident has to pay the ground rent which is a compensation for repair of the property time to time. It means that repairs are to be done by the leaseholder. In addition, a leaseholder has to bear yearly cost. Leases are mostly for the period of 99 years and extension may be taken if one desires.