What does the term "leasehold" refer to in property management?

The term "leasehold" specifically refers to a tenant's legal right to occupy a property under the terms of a lease agreement. In property management, this concept signifies that a tenant does not own the property itself but has the legal right to use and enjoy it for a specified period, typically agreed upon in the lease contract. This arrangement distinguishes leasehold from freehold ownership, where an owner has full rights to the property.

In leasehold situations, the tenant typically pays rent to the landlord and agrees to adhere to specific terms outlined in the lease. This legal framework allows both parties to understand their rights and responsibilities, with the lease outlining the duration of tenancy and other essential conditions.

Understanding the nature of leasehold rights is crucial for property management, as it influences how properties are operated, maintained, and the relationship dynamics between landlords and tenants.