In India, let me inform you that leasehold and freehold properties differ primarily in terms of ownership rights and the level of control the owner has over the property. In a freehold property, the buyer has complete ownership of the land and the building on it. Whereas, in a leasehold property, a government authority or private entity for a specific period leases the land to the buyer. Read on to know exactly what the difference between freehold and leasehold property is.
What is Difference Between Freehold and Leasehold Property?
Here’s a detailed look at the differences between leasehold and freehold properties:
Feature |
Freehold Property |
Leasehold Property |
Ownership Rights |
Permanent ownership of land and building |
Right to use property for the lease period only |
Duration |
Indefinite can be passed on to heirs |
Limited to lease term (e.g., 30-99 years) |
Control and Flexibility |
Full control over modifications |
Limited control; requires lessor’s permission |
Sale and Transfer |
Can be sold or transferred freely |
Requires lessor’s consent for sale |
Property Value |
Higher appreciation |
Moderate appreciation, value may decline over time |
Conversion |
Already freehold |
Can be converted to freehold in some case. |
Inheritance Rights |
Heirs get full ownership |
Heirs inherit the remaining lease period only |
Bank Loans and Financing |
Easy to get |
May be more restricted, especially for short leases |
I hope you understand what difference between leasehold and freehold property is.
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If you are going to buy or sell a property, you must be familiar with the terms ‘Leasehold’ and ‘Freehold’. Let’s understand the difference between freehold and leasehold property.
Leasehold vs Freehold Properties - Definitions and Differences Leasehold PropertyIf your property is the leasehold property, you have the right to reside in that particular property for a certain period of time which varies between 30 to 99 years. Lease period can be extended to 999 years. In this case you are not the owner of the property.
For leasehold property, you need to pay ground rent to the owner. Most of the apartments in the housing complexes are on lease and have to be renewed after a certain period of time by paying a certain amount. Availing loans on leasehold property is a bit difficult.
Freehold PropertyIf the property you are buying is a freehold property, you are the owner of that property. You have the right to use the property as you want keeping the local regulations in mind. You can renovate, sell or transfer the property as per your wish.
Whenever you want to sell the property, you will not need any permission from authorities. Freehold properties are more expensive in comparison to the leasehold properties and involve less paperwork. Availing loans is easier for freehold properties than leasehold properties.
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leasehold vs freehold properties. I hope you have a fair idea of difference between freehold and leasehold property.
Find more information on what is leasehold property here Check out what is freehold property here
What is the difference between leasehold and freehold property?
Shikha
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2021-08-16T17:05:35+00:00 2021-08-16T17:38:47+00:00Comment
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