Short leases can drastically reduce your property’s value and make it nearly impossible to sell or remortgage.
As your lease drops below 80 years, extension costs rise dramatically, adding thousands to the premium you’ll pa
Our Lease Extension Calculator gives you an instant estimate of what extending your lease will cost in the UK, helping you make informed decisions before approaching your freeholder or hiring a solicitor.
Lease Extension Calculator – UK Property Lease Cost Estimator
Lease Extension Calculator
Legal Disclaimer: The results provided by this calculator are for informational purposes only and are based on simplified assumptions. They do not constitute legal, financial, or professional advice. Please consult a qualified professional before making any decisions based on these estimates.
Introduction - What is a lease extension
A lease extension adds more time to your existing property agreement. When you own a leasehold property, you have the right to live there for a set number of years.
As this time gets shorter, the property value can drop. Getting a lease extension increases the remaining years, which can improve your property's market value.
As of 2022-23, there were approximately 4.76 million leasehold dwellings in England, accounting for 19% of the housing stock. Of these, 72% (around 3.44 million) were flats, and 28% (approximately 1.33 million) were houses.
The process involves paying a fee to the freeholder, who owns the land your property sits on. Most property owners start thinking about lease extensions when their remaining term falls below 80 years.
What Happens When a Lease Runs Low?
Your property value falls as your lease length decreases. Banks and mortgage lenders become less willing to offer loans on properties with leases under 80 years.
Selling becomes harder since buyers struggle to get financing. The cost of extending your lease grows much higher once it drops below 80 years due to something called "marriage value" - a legal term for the extra value created when extending a short lease.
In 2022, leasehold transactions represented 24% of residential property transactions in England and Wales, totaling around 207,000 transactions.
Property experts recommend taking action before your lease hits this critical 80-year mark. Many homeowners feel surprised by how quickly lease extension costs rise in the final years.
Who Can Extend a Lease?
You can extend your lease if you've owned the property for at least two years. The law gives qualifying leaseholders a legal right to add 90 years to a flat lease or 50 years to a house lease. Both cash buyers and mortgage holders have these rights.
The Guardian
Some leaseholders have experienced significant increases in service charges, with reports of charges reaching up to £8,000 per year, leading to financial strain and potential legal action.
Joint owners must apply together for the extension. Executors of estates can start the process if the original leaseholder dies. First-time buyers should check lease lengths carefully, as they'll need to wait two years before qualifying for an extension.
People buying properties with short leases sometimes ask the seller to start the extension process before the sale completes.
How Much Does a Lease Extension Cost?
The price for extending your lease depends on several factors. Your property value, current lease length, annual ground rent, and location all affect the final cost.
For a typical flat worth £250,000 with 75 years left, you might pay between £10,000 and £15,000. Professional fees add £2,000 to £4,000 for surveyors, solicitors, and possibly a valuation expert.
Leaseholders have been overcharged on insurance premiums due to undisclosed commissions paid to landlords and managing agents, amounting to nearly £480 million over three years.
Costs jump significantly when leases drop below 80 years because of the "marriage value" that must be shared with the freeholder. Some freeholders offer informal extensions at lower costs, but these might include rising ground rents or less favorable terms.
Getting quotes from specialized lease extension surveyors gives you the most accurate picture of your potential costs.
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The Lease Extension Process Step-by-Step
First, you need to check your eligibility and get a professional valuation. Your solicitor then sends a formal notice to the freeholder stating your request to extend the lease.
The freeholder has two months to respond with a counter-offer. Both sides negotiate until they agree on a price. Your solicitor prepares new lease documents for everyone to sign. The process takes about 4-6 months when things go smoothly.
You pay the agreed premium plus all legal fees when the new lease gets registered. Some freeholders take longer to respond or disagree with valuations, which can extend the timeline. A good solicitor with lease extension experience makes the process run more smoothly.
Statutory vs. Informal Lease Extensions
The statutory route follows legal procedures set out in the Leasehold Reform Act. It gives you 90 extra years and removes ground rent, but takes longer and costs more in legal fees.
The Times
The UK government plans to abolish the leasehold system in England and Wales, transitioning to a commonhold system to provide residents with more control over their properties.
An informal extension happens when you negotiate directly with your freeholder outside the legal framework. This path can be faster and cheaper at first glance. Many freeholders offer informal deals with less paperwork.
The risks of informal extensions include the freeholder adding higher ground rent or changing lease terms in their favor. Your freeholder has no obligation to offer an informal extension, while they must follow the statutory process if you qualify. Most experts recommend the statutory route for better protection.
Legal and Professional Fees
Legal fees for lease extensions typically range from £1,000 to £2,000 for your solicitor.
You also pay for the freeholder's legal costs, which add another £800 to £1,500 to your bill. A surveyor charges £500 to £1,000 for the initial valuation report. If negotiations get complex, you might need your surveyor to attend meetings, costing extra.
Some solicitors offer fixed-fee packages that cover the whole process.
The total professional fees often add 20-30% on top of the lease extension premium itself.
These costs vary based on property location and how complicated your case becomes. Paying for experienced professionals usually saves money in the long run through better negotiations.
FAQs - Lease Extension Calculator
Can I extend my lease if I have a mortgage?
The standard statutory extension adds 90 years to your flat lease. This gives you plenty of time and makes your property more attractive to future buyers. Mortgage lenders prefer leases with at least 80 years remaining, and most buyers look for 90+ years for peace of mind.
How long should I extend my lease for?
The standard statutory extension adds 90 years to your flat lease. This gives you plenty of time and makes your property more attractive to future buyers. Mortgage lenders prefer leases with at least 80 years remaining, and most buyers look for 90+ years for peace of mind.
What if my freeholder ignores my extension request?
If your freeholder doesn't respond within the two-month legal timeframe, you can apply to the First-tier Tribunal. The Tribunal can impose terms and set a fair price for your lease extension. This legal backup protects leaseholders from unresponsive or difficult freeholders.
Is it better to extend before selling or let the buyer handle it?
Extending before selling usually makes your property more marketable and valuable. Some buyers may request a lease extension as part of the purchase. Another option is to start the formal process and then assign the benefit to your buyer, saving them the two-year ownership qualification period.
Can the freeholder refuse to extend my lease?
If you qualify under the law, the freeholder cannot refuse a statutory lease extension. They must follow the legal process. They can only dispute the price, not your right to extend. For informal extensions, freeholders have complete freedom to refuse or set their own terms.