97.7% of flats sold in England and Wales in 2025 were leasehold. Among houses, the figure was 6.3%. That gap — nearly a one-in-twenty chance for a house, a near-certainty for a flat — is not an accident of the market. It is a structural consequence of what a flat actually is: one unit inside a building that several households share, with walls, a roof, a stairwell and often a lift that no single owner can maintain alone.
This explains why flats are overwhelmingly sold leasehold, what a lease and its service charge actually pay for, and what the government's draft plan for "commonhold" tenure — a long-standing but little-used alternative — could change for new flats in future.
The structural reason flats are leasehold
A freehold house owner is solely responsible for their own roof, walls and foundations. There is no shared structure to manage, so there is no need for someone else to hold the freehold.
A flat is different. The building's structure — roof, external walls, stairwells, lifts, shared pipework — belongs to everyone living inside it, but someone still has to own it, insure it and arrange its repair. England and Wales' historical solution has been to give that ownership to a single freeholder (sometimes the original developer, sometimes a resident-owned management company), who grants each flat owner a long lease — typically 99, 125, 250 or 999 years — rather than outright ownership of the building itself.
That lease is what you are actually buying when you buy a flat: the right to occupy your unit for a fixed number of years, plus a set of obligations (the ground rent, where one still applies, and a share of the service charge) that fund the building's upkeep. Freehold vs leasehold in the UK sets out the full national data split and what each tenure means for ownership.
Houses occasionally end up leasehold too — usually where a developer retained the freehold of a new-build estate to collect ground rent or to fund management of shared estate roads and green spaces, not because the house itself needs a managing structure. That practice is the reason a small minority of houses (6.3% nationally) are leasehold despite having no shared building to maintain.
What the lease and service charge actually cover
A lease sets out who is responsible for what, and a service charge is how the freeholder recovers the cost of meeting those responsibilities. In practice, that typically covers:
- Buildings insurance for the whole structure
- Repair and maintenance of the roof, external walls and common parts
- Cleaning, lighting and maintenance of shared stairwells, lifts and corridors
- Management fees for whoever administers the building
- A reserve (sinking) fund for larger, infrequent works such as a roof replacement or lift overhaul
What ground rent and service charges add to your mortgage walks through what these costs look like in practice on a real new-build flat, and New-build flat service charges: what's typical in the UK sets out typical charge levels by building type.
By property type: who actually holds which tenure
HM Land Registry Price Paid Data for 2025 sales (categorised as standard residential transactions) shows the split by property type:
| Property type | Leasehold sales (2025) | Total sales | Leasehold share |
|---|---|---|---|
| Flat / maisonette | 128,499 | 131,523 | 97.7% |
| Terraced house | 18,974 | 218,103 | 8.7% |
| Semi-detached house | 17,205 | 247,880 | 6.9% |
| Detached house | 6,570 | 213,129 | 3.1% |
| All houses combined | 42,749 | 679,112 | 6.3% |
Across the whole property register — not just 2025 sales — 3.73 million of England and Wales' roughly 16.57 million registered properties are leasehold, about 22.5%, or just over one in five homes (HM Land Registry, 2026).
Commonhold: the alternative that hasn't caught on
Commonhold has existed in law since 2002. Under commonhold, each flat owner holds the freehold of their own unit outright and indefinitely — no lease, no countdown, no ground rent — while the building's shared structure is owned and managed jointly through a commonhold association that every unit owner is entitled to join (GOV.UK, Commonhold property guidance).
In the two decades since it became available, take-up has been very low: the overwhelming majority of new flats are still sold leasehold, and converting an existing leasehold building to commonhold requires every leaseholder to agree, plus additional conditions, which in practice has proved a high bar for most blocks to clear.
What the government's draft bill would change
In 2020, the Law Commission recommended reinvigorating commonhold as a workable alternative to leasehold. The government has since set out, in a Commonhold White Paper, its intention to make commonhold the default tenure for new flats, and published a draft Commonhold and Leasehold Reform Bill. The Housing, Communities and Local Government Select Committee opened pre-legislative scrutiny of the draft Bill in February 2026 — meaning, as of this article, it remains a proposal under scrutiny, not current law.
As published, the draft Bill would:
- Ban the use of leasehold for most new flats, with commonhold intended as the default instead
- Make it easier for existing leaseholders to convert their building to commonhold if they choose to
- Cap ground rent on existing leases at £250 a year, falling to a peppercorn (effectively nil) after 40 years
- Replace forfeiture — the landlord's power to take back a leasehold property for breaches such as unpaid charges — with what the government describes as a fairer, more proportionate enforcement scheme
- Repeal similar forfeiture-style enforcement powers that currently apply to estate rentcharges on some freehold estates
None of this is in force yet. The Leasehold and Freehold Reform Act 2024 — a separate, earlier Act — already made some changes to leasehold enfranchisement and lease extension, but did not itself ban new leasehold flats or introduce the £250 ground rent cap; those are part of the draft Bill still going through scrutiny. Anyone buying a leasehold flat today is buying under the current rules, not the proposed ones, and timing of any future change is for Parliament to determine.
What this means if you're buying a flat
None of this changes what a conveyancer needs to check on a specific lease today: its remaining length, the ground rent terms, the service charge history and the building's reserve fund. A short lease or an unusually structured ground rent can still affect mortgage lending and resale, regardless of what future legislation may do. This is general information about how leasehold and commonhold work, not advice on a specific purchase — speak to a qualified conveyancer or solicitor before acting on anything here.
Try the Homecost tool on a flat-heavy city-centre postcode such as M1 1AE in Manchester to see tenure recorded against individual addresses, or browse more buyer guides on leasehold, service charges and the cost of buying.
Based on HM Land Registry Price Paid Data (2025 transactions) and HM Land Registry's tenure register, current as of October 2026.