freehold and leasehold why both?

happilass

Hi,
we are thinking of buying a flat that has a freehold, held by all the residents, which the owners bought in 2005. at the same time they also bought a leasehold for 999 years, why do they need both. I am aware of commonholds and i understand what a leasehold is but i can't understand the need for both.
hope someone can help,
thanks,
Happi

Land_Registry

The freehold is likely to cover all of the flats whilst the leasehold is for their flat alone.

richardw

The lease is probably useful because of the ability to organise things through terms in a lease.

hazyjo

There's no separate outside freeholder as with other flats. You will often see this referred to (wrongly!) as 'share of freehold'. Each flat still has a lease as the flats aren't turned to freehold, it's just that each flat owner has a share in the company that owns the freehold.

Jx

princeofpounds

Another way to think about the need for it is to imagine what the situation would be without this arrangement.

If it was freehold-only then every single flat occupier would jointly own all the flats. Obviously it's not great if your neighbour can use your property as freely as his own.

If it was leasehold-only (which isn't actually possible given you can't create a lease without a freehold on land) then no-one would own the ground, building and communal areas.

Having the two-tier structure creates different regimes to own and manage the communal and private aspects of the building.

It's funny that you know what commonhold is but not this system. There has been literally a handful of blocks across the whole country that adopted commonhold even many years after it was created.

propertyman

Individually you own Your flat with a lease.

Together they ( inc you) own the rest of the building as freeholders

or individually have a share in or are a member of company that owns the freehold

kingstreet

Try getting a mortgage on a freehold flat.

Technically, only property in contact with the ground is truly freehold, so flats upstairs are better leasehold and mortgage lenders are happier to lend on them.

The leaseholders of the flats jointly owning the freehold, ow owning shared in a company which owns the freehold is the best all-round solution.

happilass

Thank you to all of you for replying this makes it much clearer. I have only owned freehol houses and was confused. I knew about commonhold because i researched my query first and that came up often in the information. Once again thanks to all who replied it is much appreciated.
Happi