Leaseholder
Leasehold is a form of ownership where you hold the right to occupy and use a property for a fixed term under a lease, while someone else, the freeholder or superior landlord, owns the land and building. As a leaseholder who sublets, you are both a landlord to your residential tenants and a tenant to the freeholder, often making you a mesne landlord within the Private Rented Sector (PRS).
A lease will normally set out the length of term, any ground rent, increasingly a peppercorn rent for new leases, and your obligations to pay service charges, contribute to capital improvements and follow building rules. The Leasehold and Freehold Reform Act 2024 strengthens leaseholder rights on extensions and enfranchisement, and caps ground rent assumptions in valuation, while further reforms to existing ground rents are being developed.
Where you let a leasehold flat on an assured tenancy or regulated tenancy, all the usual Renters’ Rights Act duties still apply, including rental standards, fit for human habitation, Awaab’s Law, permitted payments, tenancy deposit rules, and access to the Private Rented Sector Ombudsman and PRS Database. At the same time, your own landlord can enforce lease covenants against you if your subletting breaches user, noise, pets or HMO licence conditions.
Professional leasehold landlords keep on top of both layers, the headlease and freeholder relationship on one side, and fully compliant private tenancies to their own tenants on the other.
Also see our landlord blog articles, including:
