Leasehold Definition and Legal Meaning

On this page, you'll find the legal definition and meaning of Leasehold, written in plain English, along with examples of how it is used.

What is Leasehold?

(n) Leasehold is the property which was held by a person by virtue of a lease agreement between him and the owner, permitting him to hold the property for such a period as said in the lease agreement for a consideration payable to the owner of the property. It differs from the freehold property to the extend that it is returnable after the expiry of the period.

History and Meaning of Leasehold

Leasehold is a legal term used to describe a type of property ownership. It originated in England in the Middle Ages when the feudal system was in place. Under this system, the king owned all land and granted portions of it to barons and nobles in exchange for their loyalty and military service. These nobles, in turn, leased portions of their land to peasants in exchange for their labor.

Today, leasehold refers to a property that is owned by someone under a lease agreement with a landlord, as opposed to freehold, which is full ownership of a property. A leasehold agreement typically gives the tenant the right to occupy and use the property for a set period of time, usually several years. During this time, the tenant pays rent to the landlord, and is responsible for any maintenance and repairs to the property.

Examples of Leasehold

  1. John signed a leasehold agreement with his landlord, allowing him to occupy the apartment for a period of two years in exchange for monthly rent payments.
  2. The local government owns many leasehold properties and grants long-term leases to businesses that want to operate on them.
  3. Sarah inherited a leasehold property from her grandmother, which she could use for twenty years before it reverted back to the landlord.

Legal Terms Similar to Leasehold

  1. Freehold - full ownership of a property, including the land it sits on.
  2. Tenancy - the occupancy of a property, whether as a renter or owner.
  3. Lessor/Landlord - the owner of the property who grants a leasehold agreement.
  4. Lessee/Tenant - the person who rents and occupies a leasehold property.
  5. Covenant - a legal agreement between two parties, often included in leasehold agreements, that outlines responsibilities and expectations.