Answers · UK 2025/26

How much does it cost to extend a lease on a flat?

Lease extension cost depends mainly on the property's value, the remaining lease length, and current ground rent, calculated using a statutory valuation formula -- costs typically range from a few thousand pounds for a lease with plenty of years remaining, to tens of thousands where the lease has fallen below 80 years and 'marriage value' is added to the premium.

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Extending a lease is often necessary as the remaining term shortens, both to preserve the property's value and to keep it easily mortgageable, and the cost is governed by a statutory formula rather than pure negotiation. **The three components of a lease extension premium** The statutory premium payable to the freeholder is broadly made up of: the value of the ground rent income the freeholder gives up over the extension term, the value of the freeholder's reversion (their right to regain the property when the original lease eventually ends) being pushed further into the future, and, if the lease has under 80 years remaining, 'marriage value' -- an additional sum reflecting the increase in the property's overall value created by the extension, split roughly 50/50 between leaseholder and freeholder. **Why 80 years is such a critical threshold** Marriage value only applies once the unexpired lease term drops below 80 years, and it can add a substantial amount to the premium, sometimes tens of thousands of pounds on higher-value properties -- extending a lease BEFORE it drops below 80 years avoids this marriage value charge entirely, often making early extension significantly cheaper in total than waiting. **Statutory right after two years of ownership** Most leaseholders of flats gain a statutory right to extend their lease by 90 years (adding to whatever term remains) once they have owned the property for at least two years, with ground rent reduced to a peppercorn (nil) for the extended term -- this statutory route uses the formal valuation formula rather than open negotiation, though leaseholders can also negotiate an informal extension directly with the freeholder at any time, which may be quicker but is not bound by the same statutory formula. **Worked example** A flat worth £300,000 with 75 years remaining on the lease (below the 80-year marriage value threshold) might face a lease extension premium in the tens of thousands of pounds, reflecting marriage value plus the ground rent and reversion components. The same flat, if the lease had 85 years remaining (above the threshold), would likely face a considerably lower premium, since no marriage value applies. **Additional costs beyond the premium** Beyond the premium itself, leaseholders should budget for their own valuation surveyor's fees, solicitor's fees, and the freeholder's reasonable legal and valuation costs (which the leaseholder is typically required to pay under the statutory process), all of which add several thousand pounds to the total cost. **Practical tip** Get a specialist leasehold valuer to calculate the likely premium BEFORE the lease drops below 80 years remaining if at all possible, since extending even a year or two early, ahead of that threshold, can save a substantial amount by avoiding marriage value altogether.