Types of Estates: Freehold vs. Leasehold
Definition
A freehold estate conveys ownership rights, while a leasehold estate grants the right to possess and use property for a specific period without ownership.
Example
Owning a house with the right to sell it, will it, or give it away is a fee simple absolute estate. Renting an apartment for a year is a leasehold estate.
Exam Tip
Focus on the duration of the estate. Freehold estates are indefinite, while leasehold estates have a specific term. Remember that a 'life estate' is still a freehold estate, even though its duration is tied to a life.
Related Ownership Terms
Bundle of Rights
The bundle of rights describes the rights associated with property ownership, allowing owners to use, control, enjoy, exclude others from, and dispose of the property.
Freehold Estate
A freehold estate represents ownership of real property with an indefinite duration.
Leasehold Estate
A leasehold estate grants the right to possess and use property for a defined period of time, without conferring ownership.
Life Estate
A life estate is a freehold estate that grants ownership rights for the duration of someone's life.
Water Rights: Riparian and Littoral
Riparian rights concern properties bordering flowing bodies of water (rivers, streams), while littoral rights concern properties bordering non-flowing bodies of water (lakes, oceans).
Real Property vs. Personal Property
Real property is immovable land and anything permanently attached to it, while personal property (also called chattels) is movable.
Frequently Asked Questions
Test Your Ownership Knowledge
Practice with exam-style questions to make sure you can apply Types of Estates: Freehold vs. Leasehold and other ownership concepts.