Glossary · UK
What is Leasehold Extension?
The legal process of adding years to a leasehold property's remaining term, usually for a premium, to preserve its value and mortgageability.
Full Definition
A leasehold extension increases the number of years left on a lease, the term that gives a leaseholder the right to occupy a flat or house owned by a freeholder. As a lease shortens it loses value and becomes harder to mortgage or sell, particularly once it falls below around 80 years, when an extra cost known as marriage value can apply. Qualifying leaseholders in England and Wales have a statutory right to extend, traditionally by 90 years on a flat at a peppercorn (effectively zero) ground rent, with the leaseholder paying a premium plus the freeholder's reasonable costs. Reforms have been changing aspects of this process, including ownership qualifying periods and how premiums are calculated, so check the current position on gov.uk or with a specialist solicitor or surveyor. Extending matters because a longer lease protects value and lending eligibility. The premium depends on the specific lease, ground rent and property values, so obtain a professional valuation rather than relying on a rough figure.