Freehold, Leasehold, Share of Freehold, Commonhold: Which? (2026)

You see "leasehold" or "share of freehold" on a UK property listing and are not quite sure what it means. Yet that single word determines your property's value, its saleability and how much it will cost you over the years. This guide explains the four ownership structures, shows the most critical threshold (the 80-year rule), and sets out honestly where the 2026 reforms actually stand — because there is a great deal of misinformation about this.

Four Structures in One Table

*Even freehold houses can carry an "estate charge".

Freehold and Leasehold: The Basic Difference

Freehold is the cleanest form of ownership: you own both the building and the land it stands on, without a time limit. There is no landlord, no ground rent, and no lease running down. In return, all maintenance and repairs are your responsibility. In the UK, houses are usually freehold, and (where you can get it) freehold is almost always the preferred structure.

Leasehold is the right to occupy a property for a fixed term. The land and the structure of the building belong to the freeholder (the landlord); you occupy only the interior of your flat, for the term set out in the lease. Typical lease terms are 99, 125 or 999 years. In return you pay ground rent (typically £200–£500 a year; it can approach £1,000 in expensive areas like London) and a service charge. The lease also imposes restrictions: permission for alterations, subletting rights, pets and similar matters are governed by the lease.

The critical point: as the lease shortens, your property loses value. This runs like a clock and cannot be ignored.

Share of Freehold: The Best Value for Flats

This is the option most buyers do not fully understand and the most valuable one. With "share of freehold" you still hold a leasehold in your flat — but you also jointly own the freehold of the building with the other flat owners (usually through a management company you collectively control).

Its practical power is considerable: because you (and your neighbours) are now the freeholder, you can extend your lease very cheaply (usually to 999 years) and reduce the ground rent to a peppercorn (effectively nil). You also control the service charge and the building's management collectively — which removes leasehold's greatest pain (costs you cannot control).

For that reason, share of freehold is usually seen as the best-value structure for a flat. Its one condition: the other owners must co-operate. An honest warning: if the owners cannot agree, or neglect to extend their leases, the building can still run into trouble in the long run.

Commonhold: The Future, but Not Yet

Commonhold is flat ownership without a lease: each unit owner holds the freehold of their own flat, while the common parts are owned and managed by a statutory "Commonhold Association". There is no lease term, no ground rent and no landlord. On paper it looks ideal.

But the reality is this: despite becoming law in 2002, commonhold has barely been used — as of 2025, there are fewer than twenty commonhold developments across England and Wales. The reasons: lenders' initial reluctance, developers finding leasehold more financially attractive, and gaps in the legal framework.

The government wants to change this — but honesty is essential here. The draft Commonhold and Leasehold Reform Bill published in January 2026 proposes banning new leasehold flats and making commonhold the default. But: this is not yet law. What is more, in April 2026 the Housing Minister said it was "highly unlikely" that the ban on new leasehold flats would come into force during this Parliament (a general election must be held by August 2029 at the latest). As of 2026, all new flats are still sold as leasehold. So do not postpone your purchase decision waiting for commonhold.

The 2026 Reforms: What Is in Force, and What Is Not?

There is a great deal of misinformation online about this. The honest picture:

✅ In force:

❌ NOT yet in force (a common misconception):

The conclusion: if you are buying a property today, assume today's rules apply. Do not buy a badly termed lease on the strength of a future reform.

The Most Critical Number: The 80-Year Threshold

If you are buying a flat, the one question you must ask is: how many years are left on the lease?

The figures make this concrete. As a rough guide, extending the lease on a £250,000 flat with 85 years remaining might cost around £5,000–£12,000, while with 75 years remaining it could reach £15,000–£30,000. So a flat can lose tens of thousands of pounds in value simply because time has passed, even if you do nothing.

So before making an offer, have your solicitor check three things: (1) the remaining lease term (be cautious below 90 years, and treat below 80 years as a price-affecting issue), (2) the ground rent clause (avoid onerous "doubling" clauses in particular — they can make a property unmortgageable), (3) the service charge history (the last three years).

Optivest Note: This falls directly within Optivest's real service area: legal support (conveyancing). Examining a flat's lease — checking the remaining term, the ground rent clause, the subletting permission and the service charge history — is a solicitor's standard but vital job. For a buyer living abroad it is even more critical, because you have no chance to examine the documents yourself. But the boundary is clear: Optivest does not give legal advice; whether a lease is suitable for you is an opinion for an SRA-registered solicitor. Our job is to ensure this examination happens and the right questions are asked. And our honest advice: if you are buying a flat and a "share of freehold" option is available, consider it seriously — it is usually the best-value structure.

Important notice — not legal advice: This article is for general information only and does not constitute legal advice. Leasehold reform is actively changing, and some proposed measures (the abolition of marriage value, the 990-year extension, the ground rent cap, the ban on new leasehold flats) are not yet in force; their commencement dates are uncertain. A property's lease terms are specific to it and must be examined by an SRA-registered solicitor; a RICS-accredited surveyor is needed for a lease extension valuation. Check gov.uk for the current position. Optivest does not give legal advice.

Frequently Asked Questions

Which is best?

Where you can get it, freehold is almost always the cleanest and most controllable structure (typical for houses). If you are buying a flat, share of freehold usually offers the best value: you can extend your lease cheaply, reduce ground rent to nil and control the costs collectively. Standard leasehold can be fine too — provided the lease is long and the terms are reasonable.

How many years should be left on the lease?

Be cautious below 90 years. Below 80 years, "marriage value" kicks in and the extension cost rises dramatically (the abolition of this rule is in the Act but is not yet in force). Below 70 years, most lenders will not offer a mortgage, and the property can effectively become unsellable. Ideally you want a 999-year lease.

How much does extending a lease cost?

It depends on the property value, the remaining term and the ground rent. As a rough guide: on a £250,000 flat, around £5,000–£12,000 with 85 years remaining; £15,000–£30,000 with 75 years remaining. Get a valuation from a RICS-accredited surveyor for the real figure. The good news: you now have the right to extend from the very first day you buy (the two-year rule was abolished in 2025).

Should I wait for commonhold?

No. Commonhold has existed since 2002 but has barely been used (fewer than 20 developments as of 2025). Banning new leasehold flats and making commonhold the default is only a draft proposal; the Housing Minister has said it is "highly unlikely" the ban will come into force during the current Parliament. In 2026, all new flats are still sold as leasehold.

Has ground rent been banned?

Partly. Financial ground rents are banned on new residential leases granted after 30 June 2022 (the Ground Rent Act 2022). But existing leases are not affected. Capping ground rent at £250 and reducing it to nil after 40 years on existing leases is only a draft proposal, not law.

In Summary, and How to Reach Us

The ownership structure is a UK property's most important and most overlooked feature. Freehold is the cleanest (houses). For a flat, share of freehold usually offers the best value (cheap lease extension + nil ground rent + collective control). Commonhold is promising but in practice still almost non-existent, and is not expected to become widespread soon. Leasehold is the norm and can be fine — but you must check three things: the remaining term (the 80/70-year thresholds), the ground rent clause and the service charge history.

That examination is a solicitor's job; Optivest's legal support service ensures your lease is properly examined during the purchase (we do not give legal advice — an SRA-registered solicitor is essential). Contact us or reach us on WhatsApp. See our legal support service, our new build vs resale guide, and our project listings for options.