How does 'fee simple' differ from 'leasehold' title?

The distinction between 'fee simple' and 'leasehold' title is centered on the nature and duration of ownership rights. Fee simple represents the highest form of property ownership available in real estate. When someone holds a fee simple title, they possess full ownership rights to the property, which includes the right to occupy, sell, lease, or bequeath the property. This ownership is not limited by time; it lasts indefinitely unless the owner voluntarily sells or transfers the property.

In contrast, leasehold title grants possession of a property for a specified duration defined by a lease agreement. A leasehold interest does not confer full ownership rights; instead, it allows the tenant to use and occupy the property for the term of the lease, after which the property reverts to the landlord. Leasehold interests are temporary and dependent on the terms of the lease, meaning that the leasehold can be for months, years, or even decades, but it is ultimately limited in duration.

Therefore, the correct answer highlights that fee simple denotes full ownership of property, while leasehold only represents possession for a defined period, accurately encapsulating the fundamental differences between these two types of property interests.