{"id":24892,"date":"2025-07-24T09:35:17","date_gmt":"2025-07-24T13:35:17","guid":{"rendered":"https:\/\/www.zolo.ca\/blog\/?p=24892"},"modified":"2025-08-12T09:01:30","modified_gmt":"2025-08-12T13:01:30","slug":"freehold-vs-leasehold","status":"publish","type":"post","link":"https:\/\/www.zolo.ca\/blog\/freehold-vs-leasehold","title":{"rendered":"Freehold vs. Leasehold Agreements"},"content":{"rendered":"\n\n\n<p>When searching for a home, checking to see if a property is a leasehold or freehold property is likely the furthest thing from your mind. However, it\u2019s essential that you understand the difference between freehold vs. leasehold, as this will determine your ownership rights, additional fees, your mortgage application, and even the potential resale value.<\/p>\n\n\n\n<p>So, before you sign on the dotted line, learn more about the pros and cons and the difference between freehold and leasehold properties.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"key-takeaways\">Key Takeaways<\/h2>\n\n\n\n<ul class=\"wp-block-list\"><li>There are two types of ownership in Canada: freehold and leasehold ownership, with freehold ownership being the most common<\/li><li>Freehold ownership is typically more expensive; however, the property tends to appreciate in value<\/li><li>Leasehold ownership may have a lower upfront cost; however, you must factor ground rent into your budget<\/li><\/ul>\n\n\n\n<section class=\"bg-white border-t border-b border-blacklight my-12 md:my-16 sticky md:relative top-0 md:top-auto z-10 md:z-auto alignwide  wp-block-zolo-block-toc \" aria-hidden=\"true\"><div class=\"wrapper relative max-w-2xl mx-auto md:py-8 flex flex-col flex-shrink-0 max-h-screen md:max-h-none\"><input type=\"checkbox\" id=\"toc-toggle\" class=\"hidden\"\/><label for=\"toc-toggle\" class=\"flex justify-between cursor-pointer md:cursor-auto py-4\"><div class=\"toc-title leading-normal font-medium m-0\">In this article<\/div><svg class=\"w-6 h-6 fill-current text-blue md:hidden transition-transform duration-150 ease-in-out\" viewbox=\"0 0 24 24\"><path d=\"M22 12c0-5.5-4.5-10-10-10S2 6.5 2 12s4.5 10 10 10 10-4.5 10-10zM6.9 10.9l1.4-1.4 3.7 3.7 3.7-3.7 1.4 1.4L12 16l-5.1-5.1z\"><\/path><\/svg><\/label><nav id=\"toc-nav\" class=\"zolo-toc-nav max-h-0 md:max-h-full overflow-y-auto scrollbar-hidden overscroll-none\"><ul class=\"zolo-toc-list my-4\"><li><a class=\"entry-title no-underline hover:underline\" href=\"#key-takeaways\">Key Takeaways<\/a><\/li><li><a class=\"entry-title no-underline hover:underline\" href=\"#what-is-a-freehold-property?\">What Is a Freehold Property?<\/a><\/li><li><a class=\"entry-title no-underline hover:underline\" href=\"#what-is-a-leasehold-property?\">What Is a Leasehold Property?<\/a><\/li><li><a class=\"entry-title no-underline hover:underline\" href=\"#comparison-between-freehold-vs.-leasehold\">Comparison Between Freehold vs. Leasehold<\/a><\/li><li><a class=\"entry-title no-underline hover:underline\" href=\"#understanding-condo-ownership-and-strata-titles\">Understanding Condo Ownership and Strata Titles<\/a><\/li><li><a class=\"entry-title no-underline hover:underline\" href=\"#freehold-vs.-leasehold-faq\">Freehold vs. Leasehold FAQ<\/a><\/li><\/ul><\/nav><\/div><\/section>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"what-is-a-freehold-property?\">What Is a Freehold Property?<\/h2>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" width=\"1024\" height=\"711\" loading=\"lazy\" src=\"https:\/\/www.zolo.ca\/blog\/wp-content\/uploads\/2025\/07\/what-is-freehold-1024x711.png\" alt=\"What is a freehold property?\" class=\"wp-image-24897\"\/><\/figure>\n\n\n\n<p>A freehold property means you own the buildings on the property and the land outright. There is no fixed-time limit on the ownership of the property, and it can be used or modified however you please (within local restrictions).<\/p>\n\n\n\n<section class=\"wp-block-zolo-related flex items-center py-6 leading-tight border-t border-b border-blacklight undefined\"><p class=\"font-serif pr-6 md:pr-12 mr-6 md:flex-shrink-0 border-r border-blacklight\">Related content<\/p><p class=\"related-link w-full my-0\"><a href=\"https:\/\/www.zolo.ca\/blog\/what-to-look-for-house-hunting\">What to Look for When Buying a House<\/a><\/p><\/section>\n\n\n\n<p>When you own a freehold property, you are responsible for the upkeep, maintenance, and <a href=\"https:\/\/www.zolo.ca\/blog\/property-taxes\">property taxes<\/a>.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-how-to-buy-a-freehold-property\">How to Buy a Freehold Property<\/h3>\n\n\n\n<p>There are several steps to purchasing a freehold property in Canada:<\/p>\n\n\n\n<ol class=\"wp-block-list\"><li><strong>Save for a down payment and closing costs<\/strong> &#8211; The minimum <a href=\"https:\/\/www.zolo.ca\/blog\/how-much-is-a-down-payment\">down payment<\/a> in Canada ranges from 5% to 20%, depending on the purchase price. In addition, you\u2019ll need to budget 2% to 4% of the purchase price for <a href=\"https:\/\/www.zolo.ca\/blog\/real-estate-closing-costs\">closing costs<\/a><\/li><li><strong>Decide on your budget<\/strong> &#8211; Getting pre-approved for a mortgage is an excellent way to determine how much house you can afford<\/li><li><strong>Find a property<\/strong> &#8211; Work with a real estate professional to find a home that meets your needs<\/li><li><strong>Make an offer and secure funding<\/strong> &#8211; Once the seller has accepted your offer, you should proceed with securing financing. A mortgage broker can help you get the best possible interest rate<\/li><li><strong>Closing<\/strong> &#8211; Work with a <a href=\"https:\/\/www.zolo.ca\/blog\/real-estate-lawyer-guide\">real estate lawyer<\/a> to finalize the transaction<\/li><li><strong>Get your keys<\/strong> &#8211; On closing day, you\u2019ll complete the purchase and receive the keys to your new home<\/li><\/ol>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-freehold-property-pros\">Freehold Property Pros<\/h3>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>Freedom<\/strong> &#8211; Since you own the property, you have complete control over renovations and changes, subject to local regulations<\/li><li><strong>Property value<\/strong> &#8211; Potential for property value appreciation<\/li><li><strong>Easier mortgage application<\/strong> &#8211; Since freehold is the most common ownership type in Canada, finding a mortgage lender is easy<\/li><li><strong>No ground rent fees<\/strong> &#8211; You own the property; therefore, there are no ground rent fees to pay<\/li><\/ul>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-freehold-property-cons\">Freehold Property Cons<\/h3>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>Higher purchase price<\/strong> &#8211; Freehold properties are typically more expensive than leasehold properties<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"what-is-a-leasehold-property?\">What Is a Leasehold Property?<\/h2>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" width=\"1024\" height=\"768\" loading=\"lazy\" src=\"https:\/\/www.zolo.ca\/blog\/wp-content\/uploads\/2025\/07\/what-is-leasehold-1024x768.png\" alt=\"What is a leasehold property?\" class=\"wp-image-24896\"\/><\/figure>\n\n\n\n<p>By contrast, a leasehold property means you own the home, but not the land it sits on. Instead, the land is rented from the landowner for a fixed period of time. This type of homeownership is more common in mobile home parks, condos, or homes on First Nations\u2019 land.<\/p>\n\n\n\n<section class=\"wp-block-zolo-related flex items-center py-6 leading-tight border-t border-b border-blacklight undefined\"><p class=\"font-serif pr-6 md:pr-12 mr-6 md:flex-shrink-0 border-r border-blacklight\">Related content<\/p><p class=\"related-link w-full my-0\"><a href=\"https:\/\/www.zolo.ca\/blog\/rent-to-own-guide\">Rent to Own: How Does it Work?<\/a><\/p><\/section>\n\n\n\n<p>The landowner may restrict how you use the property and whether or not you can modify the home. In addition, you must pay ground rent to have the right to use the land.<\/p>\n\n\n\n<p>The most common lease length is 99 years. However, it can range from 40 to 999 years.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-purchasing-a-leasehold-house\">Purchasing a Leasehold House<\/h3>\n\n\n\n<p>Purchasing a <a href=\"https:\/\/www.zolo.ca\/blog\/leasehold-meaning\">leasehold property<\/a> is similar to buying a freehold property. Pay close attention to the lease contract, including the expiration date, ground rent amount, additional fees, and the procedures for selling the property.&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-charges-for-leasehold-properties\">Charges for Leasehold Properties<\/h3>\n\n\n\n<p>The type of leasehold agreement determines how you pay ground rent to lease the land:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>Prepaid leasehold<\/strong> &#8211; A one-time upfront fee covers the entire lease term. There are no monthly or annual payments due<\/li><li><strong>Non-prepaid leasehold<\/strong> &#8211; Ground rent is paid to the land owner monthly or annually<\/li><\/ul>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-extending-a-lease\">Extending a Lease<\/h3>\n\n\n\n<p>The leasehold contract will clearly state the date the lease expires and the renewal or termination terms. When the lease ends, the landowner can renew it, renegotiate the terms, or choose not to renew. Some agreements may include a surrender clause stating that the building is surrendered to the landowner when the lease expires.<\/p>\n\n\n\n<p>Conversely, you may be able to buy the land from the landowner and convert a leasehold into a freehold property.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-leasehold-property-pros\">Leasehold Property Pros<\/h3>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>Potentially lower purchase price<\/strong> &#8211; Leasehold homes may be cheaper than a freehold property of similar size<\/li><li><strong>Less maintenance<\/strong> &#8211; Depending on your contract, property maintenance may be taken care of by the landowner<\/li><li><strong>Location opportunities<\/strong> &#8211; Leasehold homes may be available in areas like historic neighbourhoods where freeholds may not be available<\/li><\/ul>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-leasehold-property-cons\">Leasehold Property Cons<\/h3>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>Less freedom<\/strong> &#8211; Leasehold contracts may dictate whether or not you can make changes to the home, add structures to the land, or have pets<\/li><li><strong>May be more difficult to sell<\/strong> &#8211; It may be more challenging to find a buyer for a leasehold property, particularly near the end of the lease<\/li><li><strong>Fees<\/strong> &#8211; Maintenance fees or ground rent may add to your monthly expenses, depending on your contract<\/li><li><strong>Mortgage<\/strong> &#8211; It may be more difficult to find a <a href=\"https:\/\/www.zolo.ca\/blog\/best-mortgage-lenders-in-canada-2024\">mortgage lender<\/a> for a leasehold property<\/li><li><strong>Property value<\/strong> &#8211; Leasehold properties typically do not appreciate in value in the same way as a freehold property<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"comparison-between-freehold-vs.-leasehold\">Comparison Between Freehold vs. Leasehold<\/h2>\n\n\n\n<p>For easy comparison, explore the major differences between freehold and leasehold property:<\/p>\n\n\n\n<div id=\"footable_parent_24901\"\n         class=\" footable_parent ninja_table_wrapper loading_ninja_table wp_table_data_press_parent semantic_ui colored_table\">\n                <table data-ninja_table_instance=\"ninja_table_instance_0\" data-footable_id=\"24901\" data-filter-delay=\"1000\" aria-label=\"Freehold vs. Leasehold\"            id=\"footable_24901\"\n           data-unique_identifier=\"ninja_table_unique_id_3629482886_24901\"\n           class=\" foo-table ninja_footable foo_table_24901 ninja_table_unique_id_3629482886_24901 ui table  nt_type_legacy_table hide_horizonal_borders hide_vertical_borders striped compact vertical_centered ninja_custom_color inverted footable-paging-right ninja_table_search_disabled ninja_table_pro\">\n                <colgroup>\n                            <col class=\"ninja_column_0 \">\n                            <col class=\"ninja_column_1 \">\n                            <col class=\"ninja_column_2 \">\n                    <\/colgroup>\n        <thead>\n<tr class=\"footable-header\">\n                                                        <th scope=\"col\"  class=\"ninja_column_0 ninja_clmn_nm_difference_between \">Difference Between<\/th><th scope=\"col\"  class=\"ninja_column_1 ninja_clmn_nm_freehold \">Freehold<\/th><th scope=\"col\"  class=\"ninja_column_2 ninja_clmn_nm_leasehold \">Leasehold<\/th><\/tr>\n<\/thead>\n<tbody>\n\n        <tr data-row_id=\"17363\" class=\"ninja_table_row_0 nt_row_id_17363\">\n            <td>Common types of homes<\/td><td>Detached single-family homes or townhouses<\/td><td>Condos, mobile home parks, or detached houses in planned communities or large cities<\/td>        <\/tr>\n            <tr data-row_id=\"17364\" class=\"ninja_table_row_1 nt_row_id_17364\">\n            <td>Dwelling ownership<\/td><td>Full ownership of the property<\/td><td>Own the dwelling or unit<\/td>        <\/tr>\n            <tr data-row_id=\"17365\" class=\"ninja_table_row_2 nt_row_id_17365\">\n            <td>Land ownership<\/td><td>Full ownership of the land<\/td><td>Land is leased from the landowner<\/td>        <\/tr>\n            <tr data-row_id=\"17366\" class=\"ninja_table_row_3 nt_row_id_17366\">\n            <td>Ownership duration<\/td><td>Indefinite until you sell the property<\/td><td>Until the end of the lease term<\/td>        <\/tr>\n            <tr data-row_id=\"17367\" class=\"ninja_table_row_4 nt_row_id_17367\">\n            <td>Purchase price<\/td><td>Generally higher purchase price compared to a leasehold<\/td><td>Comparatively lower purchase price<\/td>        <\/tr>\n            <tr data-row_id=\"17368\" class=\"ninja_table_row_5 nt_row_id_17368\">\n            <td>Ongoing financial obligations<\/td><td>Responsible for all maintenance costs and taxes<\/td><td>May have to pay ground rent and maintenance fees<\/td>        <\/tr>\n            <tr data-row_id=\"17369\" class=\"ninja_table_row_6 nt_row_id_17369\">\n            <td>Resale value and potential<\/td><td>Properties often increase in value and may be easier to sell<\/td><td>May be harder to sell, especially near the end of the lease<\/td>        <\/tr>\n            <tr data-row_id=\"17370\" class=\"ninja_table_row_7 nt_row_id_17370\">\n            <td>Responsibilities<\/td><td>Responsible for all property maintenance and repairs<\/td><td>Generally responsible for dwelling maintenance, depending on the contract<\/td>        <\/tr>\n            <tr data-row_id=\"17371\" class=\"ninja_table_row_8 nt_row_id_17371\">\n            <td>Mortgage<\/td><td>Generally easier to obtain<\/td><td>May be more difficult to find a lender<\/td>        <\/tr>\n            <tr data-row_id=\"17372\" class=\"ninja_table_row_9 nt_row_id_17372\">\n            <td>Control over the property<\/td><td>Full control over the property (within local restrictions)<\/td><td>Contract may restrict modifications to the home or usage of the property<\/td>        <\/tr>\n    <\/tbody><!--ninja_tobody_rendering_done-->\n    <\/table>\n    \n    \n    \n<\/div>\n\n\n\n\n<h2 class=\"wp-block-heading\" id=\"understanding-condo-ownership-and-strata-titles\">Understanding Condo Ownership and Strata Titles<\/h2>\n\n\n\n<p>When you purchase a condo or house with a strata title, you own your unit and have an ownership interest in common areas or assets through the <a href=\"https:\/\/www.fulcrumlaw.ca\/law-dictionary\/strata-corporation\">strata corporation<\/a>. Additionally, you will pay strata fees (also called condo fees) to cover the cost of maintaining the amenities and common areas.<\/p>\n\n\n\n<section class=\"wp-block-zolo-related flex items-center py-6 leading-tight border-t border-b border-blacklight undefined\"><p class=\"font-serif pr-6 md:pr-12 mr-6 md:flex-shrink-0 border-r border-blacklight\">Related content<\/p><p class=\"related-link w-full my-0\"><a href=\"https:\/\/www.zolo.ca\/blog\/condo-maintenance-fees\">Guide to Condo Maintenance Fees<\/a><\/p><\/section>\n\n\n\n<p>Strata housing can be either leasehold or freehold.<\/p>\n\n\n\n<div id=\"footable_parent_24866\"\n         class=\" footable_parent ninja_table_wrapper loading_ninja_table wp_table_data_press_parent semantic_ui colored_table\">\n                <table data-ninja_table_instance=\"ninja_table_instance_1\" data-footable_id=\"24866\" data-filter-delay=\"1000\" aria-label=\"Leasehold vs Strata\"            id=\"footable_24866\"\n           data-unique_identifier=\"ninja_table_unique_id_1508628614_24866\"\n           class=\" foo-table ninja_footable foo_table_24866 ninja_table_unique_id_1508628614_24866 ui table  nt_type_legacy_table hide_horizonal_borders hide_vertical_borders striped compact vertical_centered ninja_custom_color inverted footable-paging-right ninja_table_search_disabled ninja_table_pro\">\n                <colgroup>\n                            <col class=\"ninja_column_0 \">\n                            <col class=\"ninja_column_1 \">\n                            <col class=\"ninja_column_2 \">\n                    <\/colgroup>\n        <thead>\n<tr class=\"footable-header\">\n                                                        <th scope=\"col\"  class=\"ninja_column_0 ninja_clmn_nm_who_owns_the \">Who owns the...<\/th><th scope=\"col\"  class=\"ninja_column_1 ninja_clmn_nm_freehold_strata \">Freehold Strata<\/th><th scope=\"col\"  class=\"ninja_column_2 ninja_clmn_nm_leasehold_strata \">Leasehold Strata<\/th><\/tr>\n<\/thead>\n<tbody>\n\n        <tr data-row_id=\"17360\" class=\"ninja_table_row_0 nt_row_id_17360\">\n            <td>Unit or building?<\/td><td>Homeowner<\/td><td>Homeowner<\/td>        <\/tr>\n            <tr data-row_id=\"17361\" class=\"ninja_table_row_1 nt_row_id_17361\">\n            <td>Land?<\/td><td>Homeowner<\/td><td>Landowner<\/td>        <\/tr>\n            <tr data-row_id=\"17362\" class=\"ninja_table_row_2 nt_row_id_17362\">\n            <td>Common areas?<\/td><td>Shared with other homeowners<\/td><td>Shared with other homeowners<\/td>        <\/tr>\n    <\/tbody><!--ninja_tobody_rendering_done-->\n    <\/table>\n    \n    \n    \n<\/div>\n\n\n\n\n<h2 class=\"wp-block-heading\" id=\"freehold-vs.-leasehold-faq\">Freehold vs. Leasehold FAQ<\/h2>\n\n\n\n<h3 class=\"wp-block-heading\">Are most houses freehold or leasehold?<\/h3>\n\n\n\n<p>Most houses in Canada are freehold properties. Many leasehold properties are found in mobile home parks, condos, and townhomes or on land owned by municipalities, universities, or First Nations.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Is freehold property a good investment?<\/h3>\n\n\n\n<p>Freehold properties are generally considered a better investment than leasehold properties. Freehold properties tend to appreciate in value over time, while leasehold properties do not appreciate in the same way. In addition, leasehold properties may lose value at the end of the lease.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Learn the key differences between leasehold and property agreements, and how they affect your ownership rights<\/p>\n","protected":false},"author":112,"featured_media":24895,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[47],"tags":[],"guide":[],"class_list":["post-24892","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-buying"],"acf":[],"zolo_excerpt":"","_links":{"self":[{"href":"https:\/\/www.zolo.ca\/blog\/wp-json\/wp\/v2\/posts\/24892","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.zolo.ca\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.zolo.ca\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.zolo.ca\/blog\/wp-json\/wp\/v2\/users\/112"}],"replies":[{"embeddable":true,"href":"https:\/\/www.zolo.ca\/blog\/wp-json\/wp\/v2\/comments?post=24892"}],"version-history":[{"count":8,"href":"https:\/\/www.zolo.ca\/blog\/wp-json\/wp\/v2\/posts\/24892\/revisions"}],"predecessor-version":[{"id":24935,"href":"https:\/\/www.zolo.ca\/blog\/wp-json\/wp\/v2\/posts\/24892\/revisions\/24935"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.zolo.ca\/blog\/wp-json\/wp\/v2\/media\/24895"}],"wp:attachment":[{"href":"https:\/\/www.zolo.ca\/blog\/wp-json\/wp\/v2\/media?parent=24892"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.zolo.ca\/blog\/wp-json\/wp\/v2\/categories?post=24892"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.zolo.ca\/blog\/wp-json\/wp\/v2\/tags?post=24892"},{"taxonomy":"guide","embeddable":true,"href":"https:\/\/www.zolo.ca\/blog\/wp-json\/wp\/v2\/guide?post=24892"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}