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Virtual Freehold

‘Virtual Freehold’ is a generic term not a legal term and is used to describe a lease where the length of lease is far longer than the norm (which is typically 99 to 199 years). The length in a ‘virtual freehold’ will normally be 999 years and crucially the ground rent would be a ‘peppercorn’. To put this in perspective if William the Conquer had been granted a virtual freehold when he arrived in 1066 he would still have 48 years left to run!

 

The benefit of it is that because the tenure the owner has is leasehold and not freehold, the lessee is more easily bound to comply with obligations under the lease rather than relying on covenants in the title.

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This 'Glossary of Terms' – those commonly used in the realm of property auctions, is monitored and updated regularly to remain a current reference point.

If there are any terms that you have come across which we have not included here and you are unclear about, please do get in touch and we will be happy to provide you with a clear explanation and add the new term to our list.

For more information on buying or selling at a property auction, have a read of our guide to buying at auction.