Difference between leasehold and freehold property?

Lease hold or a freehold property is defined by the status of the land on which the property is constructed. In places like Mumbai large tracks of land are owned by various agencies like Mahada, CIDCO, MMRDA, collector, large trusts, these lands are owned by the respected agencies but given on long leases to developers and societies to develop properties on them.

These lands are not owned by these various agencies. It is given on long lease. It could range from 99 years to even 999 years. However it is important for you to know that the leasehold properties generally fetch a lower value than the freehold property. It is because of the uncertainty which is there towards the end of the lease period, whether the lease will be renewed or not renewed. At what rate or what charge the agency will levy at the time of renewal and hence there is a lot of uncertainty about it.

Hence if the budget permits and the circumstances favour you it is always advisable to go for a freehold property over a leasehold property.