The story
From the idea that the "ground" on which the freehold estate stands is above the actual ground, and hence that the freehold is flying.
Etymology from Wiktionary, CC BY-SA 4.0.
flying freehold
Today it means: The freehold of property in an upper storey above a lower storey that belongs to a different freehold; the converse of creeping freehold. Full definition →