possessory estate

A possessory estate, or present possessory estate, is an interest in real property that entitles the holder to its current use and possession. A possessory estate can be contrasted with a future interest, which may lead to possession of the property in the future.

Possessory estates can be divided into freehold estates and nonfreehold estates. In a freehold estate, the holder of the possessory estate also has full ownership of the property. Freehold estates include fee simple absolute, life estates, and the defeasible fees: fee simple determinable, fee simple subject to a condition subsequent, and fee simple subject to an executory limitation. A fee tail is an antiquated form of freehold estate that has been abolished in most jurisdictions. 

In a nonfreehold estate, most commonly a lease, the holder of the possessory estate does not have full ownership of the property.

Multiple parties can hold a possessory estate simultaneously as a concurrent estate. 

[Last reviewed in June of 2025 by the Wex Definitions Team] 

Keywords

• property

Wex

• PROPERTY
• property & real estate law
• wex definitions