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Free hold vs Lease hold

Hi I am trying to work out the benefits and costs of free hold and lease hold flats. Am I right in believing that; If I buy a lease hold property I am not responsible for the over all building just the inside of my flat. The rest is taken care of by the free older and covered by my maintenance cost. If this is the case I don’t need buildings insurance just contents However, if I buy a free hold property then I am responsible and will need building insurance. I am unclear on what my rights and responsibilities are in terms of share of free hold. Please can you help me understand this better Sam

Asked on Apr 6 2015, General in Bournemouth | Report content

Answers (1)

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  • Hey Sam, It is important to know the difference between the two before a purchase is made. So what is freehold? Simply, a freehold ownership means that you own the building and the land that it is on. Freehold owners do not have time constraints to limit their period of stay (as happens with a lease) because the property is theirs for an unlimited amount of time. As a freehold owner it is your name that is lodged at the Land Registry as “freeholder”, with the title as “absolute”. This is generally the preferred option for purchasing a house or bungalow as there are not risks, rental payments, or maintenance costs involved with the ownership. So what is leasehold? A leasehold ownership means that you have been given permission to live in a property on the basis of a lease from the freeholder to use the home for a certain number of years. Usually, the leases are long term, such as a 99 year lease, but can be as high as 999 years, or as short as 30 years. Possession of the property will be subject to annual ground rent payments, and after the lease has expired the home will possibly revert back to the ownership of the freeholder. The lease can be extended if an agreement is made with the landlord on the cost and tenure of the new lease. I've gone more in-depth on my blog which i'll leave a link in the web reference box too. If you need any more help dont hesitate to send me an email. Good luck Sam! Jonathan :-)

    Web reference: http://https://housebuyfast.co.uk/blog/what-is-the-differ...

    Answered on Apr 16 2015, Report content

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