What are the differences between "freehold" and "leasehold" estates?

The distinction between freehold and leasehold estates is foundational in real estate law. Freehold estates confer ownership of the property for an indefinite period, allowing the owner full rights to the property. This means that the owner can hold, use, and transfer the property as they see fit, subject to any encumbrances or local laws.

In contrast, leasehold estates involve a temporary right to use and occupy a property, giving the lessee limited rights for a specified period based on the lease agreement. The tenant does not own the property but has the right to reside or operate within it for a defined duration, after which the property rights revert to the lessor.

This understanding is essential for real estate professionals, as it affects not only ownership rights and responsibilities but also legal obligations and potential returns on investment. In this context, the statement identifies the core attributes of each estate correctly, clarifying the nature of property rights associated with both freehold and leasehold estates.