What is a lease extension and why do I need one?▾
A statutory lease extension adds 90 years to the remaining term of a flat's lease and reduces the ground rent to a peppercorn (zero), under section 56 of the Leasehold Reform, Housing and Urban Development Act 1993. Short leases reduce property value, make mortgages harder to obtain, and become increasingly expensive to extend. Most mortgage lenders require at least 70-80 years remaining on the lease. You may see references to 990-year extensions: that is a provision of the Leasehold and Freehold Reform Act 2024 which has not yet been brought into force, so the statutory entitlement today remains 90 years.
What is marriage value and why does it matter at 80 years?▾
Marriage value is the increase in property value created by granting the lease extension. Under Schedule 13 to the Leasehold Reform, Housing and Urban Development Act 1993, marriage value is treated as nil where the unexpired term exceeds 80 years. Below that, the leaseholder must pay 50% of the marriage value to the freeholder, which makes extending a lease with under 80 years significantly more expensive. The Leasehold and Freehold Reform Act 2024 would abolish marriage value, but that provision is not yet in force.
How is the lease extension premium calculated?▾
The premium consists of three parts: (1) the diminution in the freeholder's interest (the loss of ground rent income and reversion value), (2) 50% of the marriage value if the lease is under 80 years, and (3) any compensation for other losses. The calculation uses capitalisation rates (typically 5-6%) and the generic Sportelli deferment rates of 4.75% for houses and 5% for flats, the higher flat rate reflecting the extra management risk of a block.
How much does a lease extension cost for a flat worth £300,000?▾
For a flat worth £300,000 with 75 years remaining and £250/year ground rent, the premium would be approximately £15,000-£25,000. With 60 years remaining, this could rise to £30,000-£50,000 due to marriage value. With 90 years remaining and no marriage value, it might be only £5,000-£10,000.
Should I extend my lease before it drops below 80 years?▾
Yes, absolutely. Once your lease drops below 80 years, the marriage value component kicks in and the premium increases sharply. For example, extending at 81 years might cost £8,000, but waiting until 79 years could cost £15,000+. The difference grows exponentially as the lease gets shorter. Extending early saves thousands.
What is a Section 42 notice?▾
A Section 42 notice is the formal legal notice served on the freeholder to start the statutory lease extension process under the 1993 Act. There is no longer any minimum ownership period: the two-year ownership requirement was abolished on 31 January 2025 by section 27 of the Leasehold and Freehold Reform Act 2024, so you can serve a Section 42 notice as soon as you are registered as the tenant of the flat. The notice states the premium you propose to pay. The freeholder then has 2 months to respond with a counter-notice.
Do I have to own my flat for two years before extending the lease?▾
No. That requirement was abolished on 31 January 2025. Section 27 of the Leasehold and Freehold Reform Act 2024, commenced by SI 2025/57, removed the two-year ownership qualification for both flat lease extensions under the 1993 Act and house claims under the 1967 Act. Recent buyers no longer need to wait, and no longer need the old workaround of having the seller serve the notice and assign the benefit of it on completion.
Can I extend the lease on a house?▾
Yes, under the Leasehold Reform Act 1967, leaseholders of houses have the right to either extend the lease by 50 years or purchase the freehold. There is no minimum ownership period, that requirement having been abolished on 31 January 2025. House lease extensions do not include marriage value in the same way, and the calculation methodology differs.
What professional fees will I need to pay?▾
You will need to pay for: your own solicitor (£1,500-£3,000), your own valuation surveyor (£500-£1,500), the freeholder's reasonable legal costs (£1,000-£2,000), and the freeholder's valuation costs (£500-£1,000). Total professional fees typically range from £3,500 to £7,500 on top of the premium.
How long does a lease extension take?▾
The statutory process takes a minimum of 6-8 months. After serving the Section 42 notice, the freeholder has 2 months to respond. If terms are agreed, completion follows in 2-3 months. If disputed, a Tribunal hearing may add another 6-12 months. An informal (non-statutory) extension can be quicker but offers fewer protections.
Will the Leasehold and Freehold Reform Act 2024 change lease extension costs?▾
Eventually, yes. The Act would remove marriage value, set prescribed capitalisation and deferment rates, and give flat owners a 990-year term instead of the current 90-year addition. Those valuation provisions have not been commenced and remain subject to litigation, so as at August 2026 the pre-reform methodology still applies and is what this calculator uses. The parts of the Act already in force include the abolition of the two-year ownership requirement on 31 January 2025.