What is leasehold?

Leasehold flats can be in purpose-built blocks, in converted houses or above commercial or retail premises.

When buying a property, a leaseholder effectively rents from the freeholder for a number of years, decades or centuries. When the freeholder grants a lease, they become a “landlord”.

The leasehold ownership of a flat usually relates to everything within the four walls of the flat, including floorboards and plaster to walls and ceiling. A garden can be included unless it is a communal garden for the building.

The structure and common parts of the building and the land it stands on are usually owned by the freeholder. The freeholder is, normally, responsible for the maintenance and repair of the building. If so, the costs for doing so are recoverable through the service charges and billed to the leaseholders.

The freeholder or resident management company usually appoint a managing agent to manage their block.