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This page is general information about freehold and leasehold property in England and Wales. It is not legal advice and it does not tell you which tenure to buy. Ethical Conveyancing (TG Legal Services) is an introducer, not a regulated law firm. Panel solicitors regulated by the SRA do the legal work. Your solicitor will review the title or lease in front of them.

Last reviewed: 30 August 2026.

Most houses in England and Wales are sold freehold. Most flats are sold leasehold. Some houses are leasehold too, and some newer freehold houses on estates come with charges that look a little like leasehold. The label on the listing is the starting point, not the whole story.

The difference in plain English

Freehold usually means you own the building and the land it stands on, indefinitely. There is typically no ground rent and no landlord. You still pay council tax, utilities and the cost of looking after the property. On some modern estates you may also pay an estate charge to a management company for shared roads, drainage or open space — that is not the same as a lease, but it is an ongoing cost. See “Fleecehold and estate charges” below.

Leasehold means you own the property for a fixed number of years under a lease, not the land (or, for a flat, not the building’s structure and common parts). The lease is a contract. It usually includes ground rent, service charges, insurance arrangements, and rules about pets, flooring, alterations and subletting. When the years run out, the property reverts to the landlord — which is why remaining term is one of the first things solicitors and lenders look at.

Neither tenure is “good” or “bad” in the abstract. A well-run block with a long lease and modest charges can be straightforward. A freehold with expensive unadopted roads can be less so. The solicitor’s job is to report what the documents actually say.

Ongoing costs — what typically sits around each tenure

These are typical heads of cost, not a bill for your property.

Freehold (traditional house)
- Council tax, utilities, buildings insurance you arrange yourself.
- Repairs and maintenance — all yours.
- Sometimes: estate or rentcharge payments on newer developments (see below).

Leasehold (typical flat, some houses)
- Ground rent — a sum reserved by the lease. Many older leases have a modest ground rent; some have clauses that increase it. New residential leases granted since the Leasehold Reform (Ground Rent) Act 2022 generally have to be peppercorn (effectively zero) ground rent. That Act does not automatically rewrite existing leases.
- Service charge — your share of insuring, repairing and managing the building and common parts. This is often the larger ongoing figure, and it can move year to year.
- Reserve / sinking fund contributions for bigger works (roof, lifts, external decoration).
- Buildings insurance — often arranged by the landlord or manager and recovered through the service charge, rather than by the leaseholder separately.
- Permission fees — many leases charge for consent to alterations, pets, or subletting.
- On a sale or purchase: management pack, notice of assignment or charge, deed of covenant, certificate of compliance. These are one-off transaction charges and are easy to underestimate. They are covered in What to know about buying or selling a leasehold.

Service charge and ground rent are not conveyancing fees. They continue after completion. Asking for recent accounts and any planned major works, early, is how most buyers avoid a surprise in year one. The solicitor will raise enquiries; you still need to be comfortable with the numbers.

Short leases and lending — practice, not a legal rule

There is no single law that says a lease under 80 years cannot be mortgaged. What you will often see in practice is lender caution as the remaining term gets shorter.

Many lenders look more closely — or decline — when a lease has under about 80 years left, because:

  • the term is a wasting asset: every year that passes, the lease is shorter for the next buyer;
  • below 80 years, the premium to extend a flat lease under the current valuation rules still typically includes marriage value, which makes extensions more expensive;
  • a future buyer’s lender may take the same view, which can affect resale.

Some lenders use different thresholds (for example looking at term remaining after the mortgage would end). Criteria change. This page cannot tell you whether a particular lease will be acceptable to a particular lender. A mortgage broker and the solicitor acting for you will work from the actual term and the lender’s current handbook.

If you are buying a short lease, that is also extra legal work — more enquiries, sometimes indemnity or a discussion about extension after completion. Statutory lease-extension rights exist in some cases; what applies depends on the lease, whether it is a house or a flat, and the law in force at the time. Your solicitor will advise. This is not a recommendation to extend, wait, or walk away.

A related point that is easy to get wrong in 2026 copy: the two-year ownership wait before a leaseholder could claim a statutory extension or enfranchisement was removed from 31 January 2025. A buyer can often start a claim after they own the lease, without waiting two years. That is not the same as having the right while still buying, and it is not the same as the longer 990-year extensions that are not yet in force. See the reform box below.

Fleecehold and estate charges on some new-build freeholds

“Fleecehold” is a campaign label, not a legal tenure. It is used for freehold houses (and some leaseholds) where a private company charges for maintaining shared estate infrastructure — roads, sewers not yet adopted, playgrounds, gates, public open space — often with the right to increase the charge and little democratic control.

On many new estates, the council has not adopted the roads or sewers. A management company (sometimes owned by the developer, later handed to residents, sometimes kept by a third party) collects an estate charge or rentcharge. Buyers who thought “it’s freehold, so no service charge” can still have an annual bill and restrictions in the transfer.

This is common enough on 21st-century housing developments that solicitors routinely look for it on new-build freeholds. It does not mean every new freehold is a problem. It does mean the plot documentation and any estate management scheme are worth reading with the same attention you would give a lease.

For new-build conveyancing more generally — warranties, unadopted roads, reservation fees — see Buying a new build in 2026. Tell the quote form it is a new build so the fee can reflect the extra work.

Why leasehold purchases often take longer

Leasehold files typically involve more people: landlord or managing agent, sometimes a superior landlord, sometimes a housing association (shared ownership). In practice that means:

  • a management pack (often paid for by the seller) can take days or weeks to arrive, and may need chasing;
  • replies to enquiries about service charges, major works, fire safety and building insurance sit with the manager, not only the seller’s solicitor;
  • notices, deeds of covenant and certificates of compliance add steps around completion.

A straightforward chain-free freehold can complete more quickly than a leasehold in a slow-to-reply block. That is a timescale point, not a reason to avoid flats. Budget extra time if the listing says leasehold. How long conveyancing takes in 2026 puts ranges around this.

Leasehold reform — what is in force, and what is not (August 2026)

Leasehold law is changing, but not all of the headlines are current practice. Treat news articles with care; the solicitor works from the lease and from what has actually commenced.

In force (relevant to a 2026 purchase):

  • Leasehold Reform (Ground Rent) Act 2022 — new qualifying residential leases generally cannot reserve a financial ground rent (peppercorn only). Already in force; not 2026 news. Existing leases are not automatically converted.
  • Leasehold and Freehold Reform Act 2024 — the two-year ownership rule for claiming a statutory lease extension or enfranchisement was removed from 31 January 2025. Other parts of that Act have different commencement dates; some still await secondary legislation.

Passed in 2024 but not in force (do not assume a buyer already has these):

  • 990-year lease extensions
  • Abolition of marriage value
  • New statutory valuation rates / a 0.1% cap on ground rent in the premium calculation

Government consultations on valuation rates opened in July 2026. Until commencement, most statutory flat extensions still use the existing valuation framework (including marriage value where the term is under 80 years).

Proposed, not yet law:

  • The draft Commonhold and Leasehold Reform Bill, published 27 January 2026, includes proposals such as commonhold as the default for most new flats, a cap on existing ground rents, and changes to forfeiture. These are proposals. They are not something a knowledge page can treat as the rules for a purchase completing this year.

Copy rule for this box: some reforms have taken effect; others are proposed or awaiting commencement. Your solicitor will explain what applies to the lease in front of them. Official starting points: GOV.UK leasehold and LEASE.

Buying or selling a leasehold — charges on the transaction

The tenure conversation is only half of it. Leasehold transaction charges — management packs, notice fees, deeds of covenant — are where many quotes look cheap until week six. We keep that detail on a separate guide so this page stays about the difference in ownership:

What to know about buying or selling a leasehold (costs and extra charges).

If you are buying, a purchase quote that flags leasehold is the clean way to see the legal fee. If you are selling a leasehold, use a sale quote. Shared ownership usually costs more and takes longer still — mention it on the form.

Why people instruct through Ethical

Ethical Conveyancing is an introducer, not a regulated law firm. Panel solicitors do the legal work. What you get with us:

  • Fixed legal fees — from £400 on a sale or purchase, from £230 on a remortgage. The legal fee we quote is the legal fee you pay. Disbursements (searches, Land Registry, and the like) sit on top.
  • No Move, No Legal Fee — if the transaction does not complete, you do not pay our legal fee. Disbursements already incurred are still payable.
  • A highly rated solicitor on our panel — not a call-centre file. Rated 4.9/5 or higher on review sites.
  • A dedicated support manager and an online portal so you can track the file without chasing.
  • A clear quote in under 60 seconds. We are not always the cheapest headline on a five-quote shop. We sell a fixed, itemised legal fee and a file you can actually follow.

If you are buying, a purchase quote that flags leasehold is the clean way to see the legal fee. If you are selling a leasehold, use a sale quote.

Frequently asked questions

Is leasehold worse than freehold?

Not automatically. Flats are usually leasehold because the building has to be managed as a whole. What tends to matter is the remaining term, the level and control of charges, the quality of management, and what the lease actually says. Your solicitor reports on the documents; this page cannot rank tenures.

Why do lenders often worry about leases under 80 years?

It is typical lender practice, not a statute that bans short leases. Below about 80 years, extending a flat lease is often more expensive under current valuation rules (marriage value), and a future buyer may find lending harder. Criteria vary by lender.

Do freehold houses ever have service charges?

Some new-build freeholds have estate charges or rentcharges for unadopted roads, drains and shared amenities. That arrangement is sometimes called “fleecehold”. It is worth reading the transfer, not only the word “freehold” on the listing.

Has ground rent been abolished?

New qualifying residential leases generally have to be peppercorn under the 2022 Act. Many existing leases still reserve a ground rent. Proposed caps on existing ground rents are not yet law.

Can I extend the lease before I buy?

Statutory extension rights are typically exercised by the leaseholder — after they own the lease. The old two-year wait was removed from 31 January 2025, so a buyer can often claim after completion without waiting two years. Whether to do so, and what it would cost, is advice on the file, not something this page can decide. See LEASE / GOV.UK.

Will leasehold take longer to convey?

Often, yes — management packs and third-party replies add time. It is common, not a fault in every case.

Where do I see the extra leasehold legal costs?

On an itemised quote, and in the leasehold charges guide. Ethical’s legal fee is fixed and quoted from £400; leasehold work is usually a stated extra on the quote, not a surprise at completion. Use the purchase quote.

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