Lease Extension Calculator

Q: What is a lease extension and why do I need one?

A lease extension adds years to your leasehold flat and typically reduces ground rent to a peppercorn. As your lease shortens, the flat becomes harder to sell and mortgage. Below 80 years remaining, the cost of extending jumps dramatically due to marriage value. Most mortgage lenders require at least 70-80 years on the lease.

Q: How much does a lease extension cost?

The cost depends on the remaining lease length, property value, and ground rent. For a £300,000 flat with 85 years remaining, expect £8,000-£15,000 premium. With 75 years remaining, £20,000-£35,000 due to marriage value. Add £3,000-£5,000 for professional fees (surveyor, solicitor, landlord's costs). The total process takes 4-12 months.

Q: What is marriage value and why does it matter at 80 years?

Marriage value is the increase in property value when a short lease is extended. Under the Leasehold Reform Act 1993, when your lease drops below 80 years, you must pay the landlord 50% of this value increase. This can add tens of thousands of pounds to the premium. Extending before reaching 80 years avoids this cost entirely.

Q: Should I extend before my lease drops below 80 years?

Yes. The 80-year mark is the most important threshold in lease extension economics. Above 80 years, you only pay the diminution in the landlord's interest. Below 80 years, you also pay 50% of the marriage value, which can double or triple the premium. The process takes 4-12 months, so start well before the deadline.

Q: What about the Leasehold and Freehold Reform Act 2024?

The 2024 Act received Royal Assent on 24 May 2024 and includes provisions for 990-year extensions, abolishing marriage value, and reducing ground rents to peppercorn. However, most provisions have not yet commenced as of early 2026 and require secondary legislation. Until then, the existing 1993 Act rules apply. Check gov.uk for commencement updates.

Estimate your lease extension premium for England and Wales. See how the 80-year cliff edge affects cost, calculate total fees including surveyor and solicitor, and understand when to extend for the best price.

Estimate the premium to extend your leasehold flat

Current lease years remaining

years

Check your lease or Land Registry title

Flat value (current market)

Estimated market value with current lease

Annual ground rent

Check your lease for the current amount

Ground rent review pattern

How your ground rent changes over time

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How to Use This Calculator

Extension Premium tab

Enter your current lease years remaining, flat value, and annual ground rent. The calculator estimates the premium your landlord will likely require, broken down into capitalised ground rent, diminution of the landlord's interest, and marriage value (if your lease is below 80 years). Expand "More options" to set the ground rent review pattern if your rent increases over time.

When to Extend tab

See how the premium changes as your lease shortens. The calculator shows the estimated cost at your current lease length and at 5-year intervals into the future. The 80-year cliff edge is highlighted — below 80 years, marriage value kicks in and the premium jumps dramatically. This helps you understand the cost of waiting.

Total Costs tab

Calculate the full budget for a lease extension including the premium, your surveyor and solicitor fees, and the landlord's reasonable costs (which you must pay). The calculator also shows the value added to your flat by extending, so you can see the net financial impact.

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The Formula

Lease extension premiums under the Leasehold Reform Act 1993 have three components:

Premium = Diminution in Landlord's Interest + Marriage Value (if lease < 80 years)

Diminution = (Capitalised Ground Rent + Reversion Value) − Extended Reversion Value

Capitalised Ground Rent = ∑ Annual Rent / (1 + capitalisation rate)^year
(summed over remaining lease term, typically at 6% capitalisation rate)

Reversion Value = Freehold Value / (1 + 0.05)^years remaining
(the Sportelli deferment rate of 5%)

Marriage Value = 50% × [(Extended Lease Value + Landlord's Extended Interest) − (Current Lease Value + Landlord's Current Interest)]
(only payable when lease is below 80 years)

The relativity determines what percentage of freehold value your lease is worth at its current length. A 90-year lease might be worth 93% of freehold value, while a 60-year lease might be only 58%. This relativity is the key driver of the premium calculation.

The marriage value represents the increase in total value when a short lease is extended. Below 80 years, the leaseholder must pay the landlord 50% of this gain. This is why extending before the 80-year mark is so important — it can save tens of thousands of pounds.

Example

Sophie — Flat owner, Manchester

Sophie owns a flat in Manchester worth £300,000 with 75 years remaining on the lease and ground rent of £250/year (fixed). She wants to know how much a lease extension will cost.

Extension Premium tab

Lease years remaining75 years

Flat value£300,000

Annual ground rent£250

Ground rent reviewFixed

Relativity (75 years)78%

Current lease value£236,340

Capitalised ground rent~£4,000

Diminution~£12,000

Marriage value (below 80 years)~£15,000

Total estimated premium~£27,000

Because Sophie's lease is below 80 years, marriage value applies and adds significantly to the cost. If she had extended when the lease was at 82 years, the premium would have been roughly £10,000–£12,000 — saving her around £15,000.

Total Costs tab

Adding professional fees to the premium:

Premium~£27,000

Surveyor (RICS valuation)£1,000

Solicitor£1,500

Landlord's costs£1,200

Total budget needed~£30,700

Sophie needs approximately £30,700 to extend her lease. The extension will increase the value of her flat by roughly £60,000+ (from 78% to ~99% of freehold value), making it a sound investment even at this cost.

FAQ

What is a lease extension and why do I need one? ▼

A lease extension adds years to your leasehold and typically reduces or eliminates ground rent. Most flats in England and Wales are leasehold — you own the flat for a fixed number of years but not the land it sits on. As the lease shortens, your flat becomes harder to sell and harder to mortgage. Below 80 years, the cost of extending jumps sharply due to marriage value. Below 70 years, most mortgage lenders will refuse to lend. Extending your lease protects the value of your home and ensures you can sell or remortgage in the future.

How much does a lease extension cost? ▼

The cost depends on three main factors: the remaining lease length, the value of your flat, and the ground rent. For a £300,000 flat with 85 years remaining, the premium might be £8,000–£15,000. With 75 years remaining, it could be £20,000–£35,000 due to marriage value. With 60 years remaining, it could exceed £50,000. On top of the premium, you'll need £3,000–£5,000 for professional fees (your surveyor, your solicitor, and the landlord's reasonable costs). The total process typically takes 4–12 months.

What is marriage value and why does it matter at 80 years? ▼

Marriage value is the increase in total property value when a short lease is extended. Below 80 years, the Leasehold Reform Act 1993 requires the leaseholder to pay the landlord 50% of this gain. For example, if your flat is worth £230,000 with 75 years but would be worth £300,000 with a long lease, the marriage value is 50% of the £70,000 difference = £35,000. This is on top of the basic premium. At 81 years, marriage value is zero. At 79 years, it kicks in fully. This "cliff edge" means extending before 80 years can save you tens of thousands of pounds.

Should I extend before my lease drops below 80 years? ▼

Yes, if possible. The 80-year mark is the single most important threshold in lease extension economics. Above 80 years, you pay only the diminution in the landlord's interest (loss of ground rent income + deferred reversion). Below 80 years, you also pay 50% of the marriage value — which can double or triple the premium. If your lease is at 83–85 years, acting now is strongly advisable. Remember the process takes 4–12 months, so you need to start well before the 80-year mark. The premium also continues to rise as the lease shortens further below 80 years, so even if you're already below 80, extending sooner is cheaper than extending later.

What about the Leasehold and Freehold Reform Act 2024? ▼

The Leasehold and Freehold Reform Act 2024 received Royal Assent on 24 May 2024. Key provisions include: extending lease extensions to 990 years (up from 90 for flats), abolishing marriage value, and reducing ground rents to peppercorn on extension. However, most provisions have not yet commenced as of March 2026 — they require secondary legislation to come into force. Until commencement, the existing Leasehold Reform Act 1993 rules apply (90-year extension, marriage value payable below 80 years). Check gov.uk for the latest commencement dates. If you're waiting for the 2024 Act, bear in mind that your lease is shortening every day, and any delay risks crossing the 80-year threshold under current rules.

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