How it works
The freeholder grants the headlease, and the headlease holder may then grant underleases or subleases. The obligations set out in the headlease, such as ground rent, repairs and use restrictions, flow down the chain and bind what those subleases are able to permit.
Why it matters for landlords
If you let a leasehold flat, your tenancy sits beneath the headlease. Breaching the headlease terms, for example subletting restrictions or short-let bans, can put your own lease at risk, so it is worth checking the headlease before you let.
Frequently asked questions
What is the difference between a headlease and an underlease?
The headlease is the superior lease granted by the freeholder; an underlease (or sublease) is granted out of it for a shorter term and must comply with the headlease's terms.
Can a headlease stop me letting my flat?
Yes. Some headleases restrict or prohibit subletting or short lets. Check the lease and, where required, get the freeholder's consent before letting.
Related terms
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