Leasehold
Ownership of a property for a fixed term under a lease, without owning the land it stands on. Standard for flats in England and Wales, and the subject of a long-running reform programme.
A leaseholder owns the right to occupy a property for the remaining term of a lease, commonly 99 to 999 years at grant, while the freeholder owns the building and land. Most flats in England and Wales are leasehold, so most BTL flat purchases are too.
What leasehold means for a landlord
- Service charges and ground rent sit outside your control and eat directly into net yield. Always underwrite with the current figures plus a realistic escalation assumption.
- Lease length drives value. Below roughly 80 years, extending gets significantly more expensive and lenders grow cautious. Check the remaining term before offering, not after.
- Consent requirements: some leases require freeholder consent to sublet, and a lease that prohibits pets is a lawful ground to refuse a tenant's pet request.
Where reform stands
The Leasehold and Freehold Reform Act 2024 passed, but as of mid-2026 most of its headline provisions, including 990-year extensions and the abolition of marriage value, are not yet in force. What has commenced includes the abolition of the two-year ownership wait before extending or buying the freehold (since January 2025). Ground rent caps remain at consultation stage. Verify the current position on GOV.UK before pricing a short-lease deal around expected reforms.