3.3 Leasehold Estates

Leasehold Estates

A leasehold estate arises when a property owner (lessor/landlord) executes a lease with a tenant (lessee). The tenant does not own the property (fee interest), but has the right to possess and use the premises for the lease term. For the tenant, a leasehold is considered personal property.

Leasehold tenants are entitled to possess and use the leased premises as described in the lease, but their rights to exclude others are limited.

• Estate for years: Leasehold for a definite period with a set start and end date. It ends automatically at the end of the term, no notice required. Example: a three-year lease.
• Estate from period-to-period (Periodic tenancy): Leasehold that automatically renews for set periods (like month-to-month), as long as rent is paid. Either party can terminate with proper notice.
• Estate at will: Tenancy with no definite expiration—continues as long as both parties agree and conditions are met. Ends with notice or death of either party.
• Estate at sufferance: Occurs when a tenant stays without the landlord’s consent after the lease ends (a “holdover” tenant).

Check-In Questions

• Which type of leasehold estate automatically ends at a specified date, with no renewal or notice required?
  Estate for years
  Estate from period-to-period
  Estate at will
  Estate at sufferance
  Show Answer

  Correct Answer: Estate for years
  An estate for years has a definite start and end date and ends automatically.
• What is an “estate at sufferance”?
  A tenancy with no expiration date
  A tenancy that renews automatically
  A tenant remains without landlord’s consent after lease expiration
  A lease for a definite period
  Show Answer

  Correct Answer: A tenant remains without landlord’s consent after lease expiration
  An estate at sufferance occurs when a tenant stays after the lease ends, without permission.