You Don’t Have to Worry About Your Lease Running Out
The main benefit of freehold property when comparing freehold vs leasehold is the fact that you won’t need to worry about the length of your lease.
With leasehold properties, a shorter lease can be problematic as it causes issues when it comes to selling the property.
Because the definition of a freehold property is that you own the property entirely, you won’t encounter any problems selling the property and can do so whenever you like.
For many homeowners or investors, this peace of mind and level of security that comes with a freehold tenure is important.
You Don’t Need to Pay Ground Rent
Unlike leasehold tenure, you don’t need to pay ground rent for the land your property is built on since you own it yourself.
This means you’re also responsible for the upkeep of the grounds and have the freedom to do with it as you please.
If you wanted to redesign the garden of the property by adding some artificial grass, for example, you would be free to do so without having to check with someone else.
Disadvantages of Freehold Tenure
Higher Purchase Prices
One of the biggest cons of freehold properties is that they’re usually more expensive to purchase than leaseholds.
For investors who want to benefit from the highest yields possible, the cost of buying the property is essential.
This is why a lot of buy-to-let investors tend to focus on purchasing leasehold apartments with long lease lengths in order to get the most out of their investment.
While some people may favour having more responsibility, for many, such as those who want a hands-off buy to let investment, this is a huge downside of freehold tenure.
If work needed doing on the outside of the property or its communal areas, it would be down to the freeholder to pay for and arrange any repairs or maintenance.
While leaseholders will still have to pay for certain things, many works will be subsidised by the freeholder of the property.