>My fiancee owns her house but still pays rent to a land lord.

How... what...? Please explain.

UK land rights are much different then the US owing to their history of kings and lords. You don't pay property tax[1] on the land you hold. As a result there isn't much incentive to ever sell your land. Since other people still want to live on your land though you set up a deal so that they can build houses and live on that land, but they have to pay you rent. You are effectively a landlord in the truest sense of the word.

[1] If you rent out your land you start paying property tax, the government wants there own piece of that pie.

This is not false but the majority of people and properties are freehold, not leasehold. Around 3 million properties are leasehold, the majority are flats, with 1 million being houses. There are about 25 million residential properties overall, so leasehold is only about 12% of the market.

Plus, in the UK there are certainly liabilities for holding land that has a residential property on it. As the landowner, you'll be paying the council tax on it if you have no tenants, and with many councils now, that'll be a more expensive rate too (currently 150% of the standard rate for unoccupied property in my area). Of course, council tax isn't really a property tax, though it can act like one in some situations and basically covers similar things that US property taxes do.

I would point out that outside of London this is not exactly common.

The entire crown estate is held as a lease holding, and they have a lot of property in England. I know that in Northern Ireland there are many semi-detached houses on leasehold.

Not sure what you mean, since someone who owns a house doesn't have a land lord.

if she owns the property but not the land (i.e. the house is a leasehold instead of a freehold), she has a landlord

Sounds like feudalism.

that is where it all originates from: our property/land laws are all built on medieval law, as we haven't had a revolution to shake things up!

houses are nearly always freeholds, whereas flats (apartments) are normally leaseholds, as it would be unfair if one flat owning tenant has land rights over the others.

recently the government has given leaseholders the right to purchase the freehold from their landlord (if they all agree), but this involves setting up a company that all leaseholders are shareholders/directors of, with all the rights and responsibilities that that entails.

"whereas flats (apartments) are normally leaseholds"

Must be an English thing, that is certainly not the case in Scotland.

Interesting- But in that case the problem (probably) is that you have to pay super high taxes when you sell land (or they wouldn't have such weird arrangements.) This is a separate issue from the deflationary aspects of land I think.