Differences Between a Leasehold & Freehold Property

It is common for those contemplating to buy a property to be overwhelmed by the thought of having to undergo a plethora of formalities, legal terms, and procedures. Amongst most common terms are terms such as “freehold” or “leasehold” that might make you ponder over what exactly they mean. Whether one should be aware of them while purchasing a property is another source of concern. Let us contemplate over the tenure and implication of each in detail.


Freehold Property

Talking about the “interest in the land” aspect, a freehold property shall definitely suffice your requirements. As an owner of the freeholder property, you not only own the bricks and the mortar but also the land on which it is standing. In clear terms, you get an outright ownership and the land registry is on your name when you buy a 1 BHK flat in Mumbai as a freeholder.

A freehold property has numerous benefits in store and is hence the most preferred option. Not having to deal with landlords is one of them. This means no apprehensions related to ground rent or the property falling into disorder, owing to the neglect of the landlord. Keep in mind however that the burden of maintaining the property and land will be entirely yours. With the liability of repairs being on your shoulders, you need to weigh the pros and cons wisely while making a decision.

Leasehold Property

Unlike freehold property, taking a property on a lease would give you temporary rights over the home and the land that it sits on. Such an agreement is termed as lease and the tenure would be fixed. While leases were fixed to a term of 99 years, it has been expanded to 125 years recently. Since the length of the lease can have a great impact over the resale value of your property and also your capability of obtaining a mortgage, it is crucial to communicate your requirements clearly while buying a property.

As a thumb of rule, it is best to buy such a property whose lease will not go below the 80year old mark. Also, do not miss to ask the vendor to prolong the span of the lease before you purchase it. This will help you save a lot of money.


Now that you have a clear picture, it’s time to set your priorities right before going out in search for residential flats in Mumbai

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