Leasehold Estate

A Leasehold Estate is less than a freehold estate.

 

A leasehold interest or leasehold estate occurs when an owner rents real property to a tenant in return for something of value (money).

 

The tenant possesses a leasehold estate and the landlord possesses a Leased Fee Estate.  The leaseholder has the right of possession.

 

The leasehold estate remains intact even if the property is sold.  A new owner may not evict the tenant just because he has purchased the building, therefore, the lease is an Encumbrance on the property.

 

•The Lessor is the owner of property who transfers the rights of its use to another.  The lessor is usually called the landlord.

•The Lessee is the one who uses the lessor's property in exchange for paying rent.  The lessee is usually called the tenant.

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