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Leasehold Tenure

Leasehold is a form of property tenure where one party buys the right to occupy land or a building for a given length of time. As lease is a legal estate, leasehold estate can be bought and sold on the open market and differs from a tenancy where a property is let on a periodic basis such as weekly or monthly. Until the end of the lease period the leaseholder has the right to remain in occupation as an assured tenant paying an agreed rent to the owner. Terms of the agreement are contained in a lease, which has elements of contract and property law intertwined.

The lease 'term' is usually measured in decades and a 99 year lease is quite common but 'Secure conncil tenants are always given a 125 year lease if they exercise their 'Right to Buy' (RtB ).

No matter what the term a lease is a 'wasting asset' in that from the day that it is signed, no matter what happens to its market value in the immediate future it is doomed to loose all its value in the long run. When the end of the term is reached the occupation of the property is expected to cease and vacant possession to be handed back by the lessee to the 'lessor'.

A lease for a piece of land giving the right for someone to build and occupy buildings might be for as long as 999 years but the Georgian developers of London sometimes wrote leases for really short periods of as little as 30 years encouraging shoddy building standards with the inevitable results.