What Is A Freehold Property and Why Is It So Popular? Pros and Cons

What Is a Freehold Property

Investing in a freehold property is the best decision you can make. With this article, you will develop a deeper understanding of freehold property.

Properties are of different types. But what is freehold property? Any property or estate free from the hold of any entity other than its owner is a freehold property. Thus, such an owner of the state holds free ownership for an infinite period and can use it for any purpose as long as it follows the local regulations.

Since, for the sale of a freehold property, the state’s consent is not needed, which reduces the amount of paperwork. Hence, the price of freehold property is comparatively higher than leasehold property.

There are no restrictions for the owner’s inheritability and transferability rights in a freehold property. There is no burden to the absolute property title in a freehold property. A freehold property is different from a condominium, where maintenance charges are required to be paid by the individual unit owner. A legal guardian has the right to inherit freehold property. Freehold property can transfer through the registration of a sale deed.

What Property is Known as Freehold Property?

The name freehold property implies a property is free from the hold. Freehold property ownership lasts forever. In freehold property, the owner has the freedom to do whatever they wish to do. Buildings can modify by the owner (with required permissions from municipal authorities). The owner does not require the consent of the state or others for the sale of a freehold property.

The freehold property owner has the right to will it, transfer it, gift it, or donate it. The heirs of the freehold property owner have the right to inherit it. The owner can also put the freehold property on lease and earn benefits from it.

Pros of Freehold Property

Freehold property, as implied by its name, entitles complete autonomy. Due to this, additional payments within the kind of ground rents, service charges, or the other form of charges required in leased hold properties need not pay by the freehold property owners.

The owner knows that they hold the property owner up to which degree. No restrictions exist on time, guests, or other factors in a freehold property. Thus, the owner can do whatever they wish to do on his land without seeking any permission from anyone.

Cons of Freehold Property

The only disadvantage of freehold properties would be that: they are dearer. As both the land and the property owns privately, the expenses for controlling it rise exponentially. Due to this factor, people who are used to living in flats or apartments, owning the property and paying no price, may find it difficult to pay prices for their living in the form of rent or lease.

Difference Between Leasehold Property and Freehold Property

An alternate to the freehold properties would be the leasehold properties which come with a different set of terms. In case you have decided to buy a leasehold property. Technically, you cannot be considered the complete owner but have signed a contract with the owner which allows you to reside on that property for a specific period.

Almost all the apartments and flats are leasehold properties, and some leasehold contracts cover a much longer period than your average apartment rental. For example, if you need a house where you can reside for years, you may sign a leasehold contract for 40-100 years.

During this period, you need to pay the ground rent to the owner, but you are still pretty much free to add or renovate your home. However, it is necessary to remember that after the agreement period is over, the property on the land will again belong to the freeholder.

What Are the Rights of Freehold Property Holders?

The transfer rights of a freehold property owner are unrestricted and are inheritable. Freehold property can only transfer by registering an acquisition document, as the freehold property title is unencumbered. You acquire the building and the land on a leasehold property.

The apartment owner becomes a shareholder if the apartment is a freehold property. You have full rights to reside on the property for as long as possible and can modify and improve it. However, most residences in India sell as freehold properties.

Can You Sell Your Freehold Property?

Yes, In case you wish to sell your property ( i.e., transfer the ownership of your property to another), you would be required to sign a sale deed with the buyer and have the sale deed registered in the concerned offices of the Sub-Registrar of Assurances.

Is It Possible to Convert a Leasehold Property to a Freehold?

There is a possibility that a leasehold property can be converted to a freehold property only if the landowner and leaseholder so desire. The lessor’s ownership rights will transfer through the sale of a deed by the lessee.

Essential Documents for Converting Leasehold to Freehold

You will need the following items to convert a freehold to a leasehold:

  • A clear sale deed
  • NOC (if the land is under mortgage or rent)
  • Pay conversion charges to the concerned authorities
  • Primary Documents
  • GPA (General Power of Attorney)

Under the Registered Sales Agreement and GPA, only renewal of leasehold to ownership status is available. A change of status may also happen on a housing tax assessment.

Investigation Report

In addition to the materials above, you should have an investigation report to conduct your research. An official investigation report demonstrates that a piece of property is free of debts, loans, litigation, and mortgages.

Conveyance Deed

Based on the papers above, the conveyance deed should register with the registrar’s office. A conveyance deed is a record that attests to the transfer of ownership from the owner (landlord) to the purchaser.

Mutation Certification

Transfer of property ownership from the seller to the buyer comes next, and the land revenue department and local government must provide payment records. The buyer will give a transformation certificate after the conversion procedure.

Cost of Converting a Leasehold into a Freehold

  • Fee delivered to the vendor (determined by negotiation and agreement between Buyer and Seller)
  • Stamp duty
  • legal fees
  • enrollment fee

These are procedures if the person wants to transform the leasehold interest into freehold ownership.

Insurance of the Freehold Property

Apartments and real estate on the free road are risky, liable, and expensive. For instance, chimneys and storms may harm structures. Freehold owners must have insurance to pay for the financial implications of property damage, and homeowner’s insurance offers sufficient financial protection if your freehold property or valuables are damaged.

The coverage and net value of the freeload property determine payment. However, the dangers of having a freehold property reduce once the owner are eligible for such insurance. Landlord liability insurance offers enough financial protection if your property becomes uninhabitable in addition to protecting your property or property from harm.


Do you now have an idea of what is a freehold property? Let’s wrap it up like this: freehold property is a property that is free from any hold, and its owner has the legal right to own it. As long as the area’s boundaries are respected, such property owners are free to utilize it however they see fit.

There is some legal procedure to follow to convert any changes in the freehold property. For these changes, permission will give by the local government under the area’s jurisdiction.

Freehold properties often cost more but have fewer formalities and legal restrictions. Purchasing a property also gives you great freedom and responsibility since you have complete authority over the land and its structures.


What comes under freehold property?

If you’ve bought a freehold home, the house and the land it’s constructed on are yours. In an apartment situation, the homeowner becomes a stakeholder in the building. You can live as long as you like in the freehold home.

What are the benefits of freehold property?

Owners are exempt from paying yearly ground rent. You are responsible for keeping the property in good shape and have no one to answer to. You possess full ownership rights to the asset.

Is a leasehold property better than a freehold?

If you’ve bought a leasehold property, you can occupy it for a predetermined time. In this case, neither the property nor the land belongs to the buyer. You will be required to pay the owner or leaseholder ground rent. Freehold is much more feasible than leasehold property.

Does Freehold property require a no objection certificate(NOC)?

A No objection certificate is an important legal document that states that the covenants listed in the certificate are not objectionable. The developer needs NOC from numerous government authorities before beginning building construction.

Can the government seize the freehold land?

According to Property Acquisition Law, the government can acquire any freehold title or private land. And use it for industrialization and infrastructure development after paying the affected landowners a fair amount of money to the owner.