eastbourne mortgage advice buying

Freehold vs Share of Freehold vs Leasehold

We explain the different costs and responsibilities with each type of homeownership, how they impact on costs to buy, sell, and maintain a property.

The exciting story of leaseholds and freeholds is a relic of English property law dating back to the 11th Century. The term ‘Freeholder’ was even used in the Doomsday book of 1089.

Back in the Medieval days the law wasn’t overly concerned with the social mobility of hardworking families trying to get on the property ladder. Land meant power and the powerful wanted to retain ownership of their land while maximising their income from it. The idea of leasing was established to allow the poor to work a plot of land, for a fixed period of time, on the basis that they would pay ‘in-kind’ by providing food and services to those further up the social order.


The freeholder of a property owns everything outright, including the land it’s built on. Generally, most houses are freehold.

When you buy freehold, you are responsible for maintaining the property and the land.

The main benefit of owning a properties freehold is that you won’t have to pay ground rent, services charges and any other charges associated with leasing or worry about the lease running out, as you own the property outright.


Most flats and maisonettes are owned leasehold. With a leasehold, you own the property and its land for the length of your lease agreement with the freeholder. When the lease ends, ownership returns to the freeholder unless you are able to extend the lease.

When you buy a leasehold property, you’ll take over the lease from the previous owner, so before making an offer you’ll need to consider:

•How many years are left on the lease;
•How it may affect getting a mortgage and the property resale value;
•How you’ll budget for service charges and related costs.

Share of Freehold

You can buy a share of the freehold with the other leaseholders (such as other people living in a small block of flats) as long as at least half of them agree to buy a share. Buying a share gives you and your neighbours more control over your homes, the costs you pay out and you can extend your lease fairly easily for up to 999 years.

It may be expensive to buy the freehold and you and the other leaseholders will then need to set up a company to manage the building, or find a managing agent to do it for you.

If you have any questions or quires regarding the types of home ownership please do feel free to give us a call 01342 826 741 or drop us an email at advice@fordyceplayle.co.uk and we will be delighted to help!

If you are interested in knowing more or would like independent mortgage advice in Eastbourne, feel free to call one of our Brokers on 01323 409 849 or email office@sentryadvice.co.uk

The blog postings on this site solely reflect the personal views of the authors and do not necessarily represent the views, positions, strategies or opinions of Sentry Advice Limited. All comments are made in good faith, and neither Sentry Advice Limited nor the author will accept liability for them. No advice is given in any posting. Please contact your adviser for more information or advice.

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