If you are considering to buy a leasehold home it can get quite confusing considering all the terms that comes along with it and considering the leasehold scandal. One is left wondering if even the building belongs to them or the landlord. Before we get to whether you become the owner of the house or not, let us look get to know more about the leasehold properties.
What is a leasehold property?
When you want to purchase a property in Wales or England, there are practically 2 options, freehold or leasehold. When one purchases a freehold property, he or she has owns both building and the land it sits on it. When one buys leasehold property, he or she has the right to stay in the building for the time stipulated on the lease agreement. But does he really own the property? The person has some responsibilities that he must fulfill to the landlord. The leaseholder is supposed to pay a service charge for the upkeep and maintenance of the property. One of the most confusing thing about the leasehold properties is the fact that the leaseholder has to pay the ground rent. But why does one has to pay the ground rent if he own the property? The leaseholder has to pay rent because even if he might be owning the property, he does not own the land it sits on. The land belongs to the freeholder and the leaseholder will be renting the land so he or she have to pay the annual ground rent.
To answer your question, according to the UK government, once one purchases a leasehold home, he or she owns the property for a fixed period of time agreed on the lease agreement. The ownership of the property returns to the landlord after the lease runs out. Beware of the leasehold scandals when you are purchasing a leasehold property.