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Is It Permissible to Buy a Leasehold House or a Shared Ownership House?

Answered according to Hanafi Fiqh by Seekersguidance.org

Question:

Assalamu ‘alaikum.

1. Are we allowed to buy a leasehold house in the UK?
For example, I will pay £50000 for the house and it has a lease of 125 years. However, I don’t own the land the house is on only the lease so once the lease runs out I will have to pay more to renew. If I don’t pay I can’t live there is this allowed?

2. Is buying a shared ownership house allowed the people that own the other shares will most likely have bought their shares via a mortgage. All I will do is buy a share and then get my rent money and in the future maybe sell the share. Is this allowed?

Answer:

Wa ‘alaykum assalam wa rahmatullah wa barakatuh.

I pray you are well.

Is it Permissible to Buy a Leasehold House?

Yes, this transaction is permissible. Although, it’s actually a long-term rental seeing as you do not actually own the property.

Is Buying a Shared Ownership House Permissible?

Yes, this would be permissible too, as long as you yourself do not get into a usurious transaction. If the share itself, or the other shares of the house had been purchased with a usurious transaction it does not affect the validity of your transaction. This is something the original owners have to deal with themselves.

The rental income from the property will also be permissible. (Maydani, al Lubab)

It’s best to avoid all forms of interest yourself, and if the other partners do engage with it, if you can give them a reminder and encouragement to repent in an effective manner do so. Tell them “Indeed Allah loves those who keep repenting…“ (Qur’an, 2:222)

May Allah grant you the best of both worlds.

[Shaykh] Abdul-Rahim

Checked and Approved by Shaykh Faraz Rabbani

Shaykh Abdul-Rahim Reasat began his studies in Arabic Grammar and Morphology in 2005. After graduating with a degree in English and History he moved to Damascus in 2007 where, for 18 months, he studied with many erudite scholars. In late 2008 he moved to Amman, Jordan, where he continued his studies for the next six years in Sacred Law (fiqh), legal theory (Usul al-fiqh), theology, hadith methodology, hadith commentary, and Logic. He was also given licenses of mastery in the science of Quranic recital and he was able to study an extensive curriculum of Quranic sciences, tafsir, Arabic grammar, and Arabic eloquence.

This answer was collected from Seekersguidance.org. It’s an online learning platform overseen by Sheikh Faraz Rabbani. All courses are free. They also have in-person classes in Canada.

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