Lease Extension Calculator

How lease extension costs are calculated

The cost of extending a lease is determined by a formula set out in the Leasehold Reform, Housing and Urban Development Act 1993 (for flats) and the Leasehold Reform Act 1967 (for houses). The premium you pay the freeholder has three components: the capitalised value of the ground rent stream, the diminution in the freeholder's reversion (the value of getting the property back later), and — for leases under 80 years — a share of the marriage value.

Enter the years remaining, the ground rent, and the property's long-lease value into the calculator above for an instant estimate. The sections below explain what drives the cost, when it jumps, and how the current reforms affect you.

What makes up the lease extension premium

Worked example: a flat with 78 years left

Here's an illustrative estimate for a flat worth £300,000 with a long lease, currently 78 years remaining, and £250/year ground rent. Because the lease has just dropped below 80 years, marriage value now applies:

These figures are illustrative and use typical assumptions (5% deferment rate, 6% ground rent capitalisation). Your actual premium depends on the specific valuation and negotiation — always get a formal valuation from a RICS surveyor. Run your own numbers with the calculator above.

Marriage value and the 80-year trap

Marriage value is the single biggest reason lease extensions get expensive. It represents the increase in the combined value of the lease and the freehold that results from the extension — and once a lease falls below 80 years, the leaseholder must pay the freeholder 50% of that gain.

At 80 years and above, marriage value is legally zero. The moment the lease drops below 80 years it switches on and grows every year after. This is why surveyors urge owners to extend before the 80-year mark: waiting even a few months either side of 80 years can add thousands to the premium. If your lease is close to 80 years, act now rather than later.

Short leases: under 60 years

Once a lease drops under about 60 years, the premium rises steeply and the property becomes hard to mortgage — most lenders won't lend on leases below 70 years, and many want 30+ years remaining after the mortgage term ends. A lease of 47 or 50 years can cost tens of thousands to extend because both the reversion and the marriage value are large.

If you're buying a flat with a short lease, factor the extension cost into your offer — a low headline price often reflects an expensive lease problem. Read our leasehold red flags guide before committing, and use the freehold purchase calculator if buying the freehold is an option.

Statutory vs informal lease extension

A statutoryextension uses your legal rights: for a flat you get an extra 90 years added to the remaining term at a peppercorn (zero) ground rent; for a house you get an extra 50 years added to the remaining term. The freeholder must agree and the premium is set by the statutory formula, with the tribunal available if you can't agree terms.

An informal extension is a private deal with the freeholder. It can be quicker and cheaper up front, but the freeholder sets the terms — they may offer fewer years or keep a ground rent, which can cause mortgage and resale problems later. Get advice before accepting an informal offer, and compare it against your statutory entitlement.

Lease extension for flats vs houses

The rules differ by property type. Flats are covered by the 1993 Act and get a 90-year statutory extension at a peppercorn ground rent — the most common lease extension. Leasehold houses are covered by the 1967 Act and get a 50-year extension, though many house leaseholders instead buy the freehold outright, which is often better value. If you own a leasehold house, compare extending against enfranchisement (buying the freehold) using our freehold purchase calculator.

Shared ownership lease extensions

Shared ownership leases can also be extended, but the process is more involved because the housing association is usually both your landlord and the freeholder (or head-lessee). Newer shared ownership homes granted on the 2021 government model lease already come with 990-year terms, so may never need extending. Older shared ownership leases can be extended, but the route and terms differ from a standard flat and often run through the association rather than the 1993 Act. Check your specific lease and the association's policy — the premium calculation and whether marriage value applies can differ. See our shared ownership guide for how staircasing and lease terms interact.

How the 2024 reforms affect lease extensions

The Leasehold and Freehold Reform Act 2024 became law but is being brought in over several stages. One change is already in force: since 31 January 2025 there is no minimum ownership period — you can start a statutory lease extension or freehold purchase as soon as you buy, rather than waiting the old two years.

Other reforms are not yet in force. The Act legislates to abolish marriage value and to set a standard extension term of 990 years, but the valuation changes still need further legislation and a consultation on the rates (expected during 2026), and freeholder legal challenges are ongoing. Until those provisions commence, the existing formula — including marriage value on leases under 80 years — still applies. Check GOV.UK or the Leasehold Advisory Service for the current position before you proceed.

Related leasehold tools and guides

Use these free tools and guides alongside the lease extension calculator:

• Freehold purchase calculator — estimate the cost of buying your freehold instead of extending
• Leasehold red flags — what to check before buying any leasehold property
• Ground rent scandal explained — escalating ground rents and how they affect value
• Section 20 service charges — your rights on major-works bills
• Freehold vs leasehold explained — the difference and what each means for you