When you buy a flat in England or Wales, it’s usually on a leasehold basis. This means you own the right to live in the property for a set number of years, known as the “term”, but you don’t own the land or structure – that remains with the freeholder (or landlord).
As a leaseholder, you’ll be responsible for the inside of your home, while the building’s maintenance, insurance, and communal areas are usually managed by the freeholder or a managing agent – and paid for by you and your neighbours through service charges.
The length of the lease reduces over time from the date when it was originally granted. The outstanding term will therefore depend on what was left when you took over the lease. The lease will also expire automatically at the end of the term, although most long leaseholders have a statutory right to stay on as renting tenants at the end of the lease, buy the freehold or extend their lease.
What is a Lease?
A lease is a legally binding agreement between you and your landlord. It outlines: How long you can live in the property (typically 99, 125 or 999 years)
Your rights and responsibilities
What you own exclusively vs. what’s shared
What costs you’re liable for
When you buy a leasehold flat, you’re taking over the lease as it stands – meaning the term will have reduced. Mortgage lenders often require 80+ years left on the lease, so it’s worth checking early. Lease extensions are possible, and specialist advice is recommended.
Understanding Leasehold
What to Look for in a Lease:
Some key questions when reviewing your lease:
How long is left on the lease?
What are the annual costs? (Ground rent, service charges, reserve fund)
How are charges calculated? (Flat percentage, floor area, etc.)
Are there penalties for late payments?
Who is responsible for what? (Insurance, windows, balconies, boilers)
Are there restrictions? (Pets, flooring, subletting, alterations)
Are there requirements when you sell? (Deed of Covenant, Notice of Transfer)
Who’s Who in a Leasehold Block?
Freeholder – Owns the land and the building
Landlord – Often the freeholder, but could also be another party
Head Lessor – May lease the entire building and sublet individual flats
Leaseholder (You) – Owns the lease and the right to live in the property
Residents' Management Company (RMC) –
Sometimes leaseholders run the building themselves via a company
Here are the key parties involved in leasehold ownership:
Managing Agent – Appointed to run the day-to-day management
Property Manager – Your day-to-day contact (usually part of the managing agent)
On-Site Team – Concierge, caretakers, cleaners, etc.
Tenant – Someone renting the flat from a leaseholder
Responsibilities:
Who Does What?
Landlord/Managing Agent You (the Leaseholder)
Maintain the structure (roof, lifts, shared facilities)
Insure the building (not contents)
Organise communal services
Maintain your flat’s interior
Insure your contents
Pay ground rent, service charges, and any reserve fund contributions
Check your lease for specific obligations (e.g. windows, balcony)
Alterations and Improvements
Likely to require consent:
Changing layout
Replacing windows
Installing hard flooring
Moving plumbing or electrics
Thinking of making changes?
You may need the landlord’s written consent.
Unlikely to require consent:
Redecorating
New carpets
Like-for-like kitchen unit replacement
Consent may be simple or require a formal Licence to Alter, especially for structural changes. Charges may apply and conditions (e.g. hours of work, reinstatement) may be imposed.
Understanding Leasehold Costs
Annual Leasehold Costs.
Here’s what you might pay each year:
Service Charges – Your share of the cost to maintain the building and shared areas
Ground Rent – An annual fee set in your lease
Reserve or Sinking Fund – Contributions saved for major future works
Licence to Alter Fees – If making changes
Lease Extension Fees – If you wish to extend your lease
Admin Charges – E g Notice of Transfer when selling
Understanding Leasehold Costs
Understanding Service Charges & Reserve Funds
Service Charges cover communal maintenance, including:
Building upkeep
Cleaning, lighting, gardening
Lift servicing
Insurance
Managing agent’s fees
Reserve Funds are collected over time for big-ticket items like:
Roof replacement
Lift upgrades
External painting
Think of it like a savings account for the building. It helps avoid large surprise bills down the line.
Major Works & Section 20 Consultations
If major works are needed and your contribution is over £250, your landlord must consult you through a formal process called a Section 20 consultation. This ensures transparency and value for money. You’ll be invited to comment on the proposed works, contractors, and estimated costs.
Getting a Mortgage on a Leasehold Property
If you're buying with a mortgage, it's important to understand how leasehold can affect your ability to borrow. While mortgage lenders do lend on leasehold homes, there are a few extra hoops to jump through – especially when it comes to the lease term and the fine print around charges.
Here’s what you need to know before applying.
Can You Get a Mortgage on a Leasehold Property?
Yes – but with conditions Most lenders will want to see that the lease meets their specific criteria before they approve your loan Your solicitor and mortgage adviser will guide you through this, but here are the key factors that lenders consider.
1. Lease Length
One of the biggest factors is how long is left on the lease. As a general rule: Most lenders prefer leases with at least 85 years remaining
Many won’t lend if the lease is under 70 years
If the term is too short, you may still be able to proceed by negotiating a lease extension before completion – something we can help guide you through
2. Ground Rent and Service Charges
Lenders look carefully at the costs written into the lease, including:
Ground Rent – Some lenders will only accept leases where ground rent at the outset is no more than 0 1% of the property value
Review Clauses – Ground rent that doubles every 10 years can be a red flag
Service Charges – Excessive or unpredictable costs may affect affordability and resale potential
⚠ Note: Ground rents on new leases were banned in 2022. However, many older leases still include them. Reforms are expected under the Leasehold and Commonhold Bill to tackle unfair terms.
3. Absent Freeholders
If the freeholder cannot be contacted –known as an “absent freeholder” – this can complicate matters, particularly where permissions or consents are needed Your solicitor will highlight this early in the process
4. EWS1 & Cladding Considerations
If you’re buying in a block of flats, particularly one that’s over 18 metres tall or has cladding, a valid EWS1 form may be required by your lender. This checks for fire safety risks and can affect your ability to secure a mortgage. If remedial works are planned (and especially if costs will fall to leaseholders), this may also be considered by lenders as part of their risk assessment
5. Property Type
Certain types of property can also raise concerns for lenders, including:
High-rise buildings
Ex-local authority flats
Blocks without a lift over a certain number of floors
If you’re unsure whether a property may be affected, ask us – we’ll help you spot any red flags before you commit
If you're buying a leasehold property with a mortgage, we strongly recommend speaking with our in-house mortgage adviser. They'll help you explore suitable options based on the lease details, the lender’s criteria, and your individual circumstances.
Our Customer Charter
Leasehold sales, made simple.
Buying or selling a leasehold property can feel like a maze. That’s where we come in. We know the ins and outs of leasehold sales – and we’re here to make the whole process as easy, clear, and stress-free as possible. With The Apartment Department, you’re in safe hands. Here’s what you can expect from us:
Straight-talking advice, from start to finish
No jargon, no waffle – just honest, expert advice tailored to you. We’ll break down the details, from lease lengths to service charges, so you know exactly where you stand
Clear, open communication
We keep you updated every step of the way. Whether it’s good news or a tricky situation, you’ll hear from us first –with real solutions to keep things moving.
A dedicated team on your side
You won’t be passed from pillar to post. You’ll have a Leasehold Specialist who knows your sale inside out, working hard behind the scenes to keep everything on track.
Proactive problem-solvers
Leasehold sales can sometimes hit a snag – but we’re always one step ahead. We work closely with solicitors, management companies, and other agents to smooth out any bumps in the road.
The right buyers, the best exposure
If you’re selling, we don’t just list your property and hope for the best We actively market it to the right buyers, giving it the attention it deserves If you’re buying, we’ll match you with apartments that suit you – and flag any leasehold quirks before you commit.
We keep the momentum going
Leasehold sales can take longer – but we don’t sit back and wait. We chase solicitors, nudge management companies, and keep the whole process moving, so you can buy or sell faster.
Support beyond the sale
Need help with lease extensions? Want recommendations for local services? We’re still here for you, long after the paperwork is signed.
The Apartment Department –because leasehold doesn’t have to be complicated.
