Lease extension costs can rise sharply once a flat has fewer than 80 years remaining on its lease. One reason is the current marriage value calculation, which can add substantially to the premium payable to the freeholder.
The Leasehold and Freehold Reform Act 2024 promises important changes, including removing marriage value and introducing longer statutory extensions. But the most significant valuation reforms were not yet in force in November 2026. Leaseholders considering a sale, remortgage or extension should distinguish the law operating today from the rules expected in the future.
This guide explains the cost of extending a residential flat lease, what the 80-year threshold means and how to decide whether to start the statutory process now or wait for reform. The legal procedure for leasehold houses can differ.
Why does a lease extension cost more below 80 years?
Under the current statutory valuation framework, a qualifying flat leaseholder can generally extend the lease by an additional 90 years and reduce ground rent under the new lease to a peppercorn (effectively zero). A premium is paid to the landlord. The Leasehold Advisory Service explains the formal route.
The premium reflects several elements of the landlord’s financial loss. The remaining lease length, the value of the flat, its ground rent and the assumptions applied by specialist valuers all matter.
When a lease has less than 80 years left, the statutory calculation may include marriage value. Broadly, this recognises the additional value created by combining the landlord’s and leaseholder’s interests through the extension. Under the current formula, the leaseholder generally pays the landlord half of that marriage value as part of the premium.
| Remaining term | Possible impact under current rules |
|---|---|
| Above 80 years | Marriage value is generally excluded from the statutory premium |
| At or below the critical threshold | The valuation needs careful checking around the statutory 80-year rule |
| Less than 80 years | Marriage value may add a substantial amount to the premium |
| Much shorter leases | A higher premium and greater sale or mortgage complications may arise |
The exact premium cannot be calculated from lease length alone. Specialist valuation evidence and the wording of the existing lease are important, and an online calculator may provide only an initial estimate.
What makes up the cost of a lease extension?
A statutory lease extension usually involves more than the premium paid to the freeholder. Under today’s rules, a leaseholder can also be responsible for the landlord’s reasonable legal and valuation costs in connection with qualifying elements of the process, as well as their own professional fees.
- Premium: the amount calculated or negotiated for the extra lease term and reduced ground rent.
- Leaseholder’s valuation: a specialist valuer’s report and negotiation support.
- Leaseholder’s legal fees: notices, reviewing title, negotiation, completion and registration.
- Landlord’s recoverable costs: reasonable legal and valuation expenditure recoverable under the existing statutory rules.
- Further expense: tribunal or specialist dispute costs where the premium or terms cannot be agreed, subject to the applicable regime.
A voluntary or informal extension may produce a different offer. The freeholder may propose a longer term but retain ground rent provisions or seek a different premium. Leaseholders should compare the overall lifetime terms, not just an attractive initial price.
The Leasehold Advisory Service’s valuation guidance explains the current factors used to determine the premium. A qualified surveyor experienced in leasehold enfranchisement can give an evidence-based range.
The cheapest-looking offer may not be the best
Our perspective
An informal extension can appear quicker and easier than a statutory claim. But a lower upfront premium is not necessarily attractive if the new lease contains ground rent, review clauses or other terms that affect future resale and mortgageability.
The legal and valuation advice should compare the full proposed lease against what the leaseholder can obtain through the statutory route.
How do you extend a lease under 80 years?
The statutory route for a qualifying flat under the Leasehold Reform, Housing and Urban Development Act 1993 normally begins with a Section 42 tenant’s notice. The landlord can then serve a counter-notice, and the parties seek to agree the premium and lease terms. If they cannot agree, a specialist tribunal may be involved.
- Check eligibility. Confirm that the flat is held on a qualifying long lease and that the relevant statutory exceptions do not apply.
- Obtain a valuation. Establish the likely premium and the financial effect of any marriage value.
- Prepare the notice. A solicitor prepares and serves the Section 42 notice on the correct landlord.
- Respond to the counter-notice. Review the landlord’s position and negotiate the premium and terms.
- Resolve disagreements. Use the applicable tribunal procedure if no agreement is reached within the statutory timetable.
- Complete and register. Finalise the new lease and attend to the necessary Land Registry steps.
For flats, qualifying ownership can be established without waiting two years after purchase. The former two-year ownership requirement was removed with effect from 31 January 2025. This is one of the changes from the 2024 legislation that has already commenced.
The current statutory flat extension is still 90 additional years, rather than the proposed 990-year term. See the Leasehold Advisory Service’s explanation of the formal process.
Example: a flat has 78 years remaining
A leaseholder discovers that their flat has 78 years left and plans to sell within 18 months. They obtain a specialist valuation and learn that the current statutory premium may include marriage value.
Rather than assuming the forthcoming reforms will be available before the sale, they compare a statutory extension now with the likely sale and mortgage consequences of waiting. They also ask the valuer to assess any informal offer from the freeholder.
The example is illustrative. The premium, saleability and best timing depend on the lease terms, property and lender requirements.
What has changed under leasehold reform in 2026?
The House of Commons Library’s August 2026 briefing confirms that most of the major provisions of the Leasehold and Freehold Reform Act 2024 had not yet commenced. The government’s September 2026 valuation explainer says it intends to introduce the reforms as soon as possible, but it does not give a guaranteed commencement date.
| Rule | In force in November 2026? | What it means |
|---|---|---|
| Two-year ownership qualifying period removed | Yes, since January 2025 | A qualifying new owner need not wait two years before beginning a statutory claim |
| Marriage value abolished in statutory valuation | No | The current calculation can still include marriage value below 80 years |
| Standard 990-year statutory extension | No | The current flat route generally adds 90 years |
| Reformed valuation rates and ground-rent valuation cap | Not yet | Future premium calculations await commencement and further legal detail |
| Landlord professional cost reforms | Not fully commenced | Check liability for reasonable landlord costs under current law |
The legislation aims to reduce costs and simplify the process for many leaseholders. However, measures requiring regulations, valuation rates and operational changes cannot be treated as if they already govern a new claim.
The government consulted on the valuation rates during 2026. That is relevant to future premiums, but the exact financial effect on a particular flat will depend on the final rules and when they take effect.
The government’s leasehold toolkit distinguishes changes already operating from those still planned. Information about leasehold reforms can change, so buyers and owners should check the latest commencement position before acting.
Avoid relying on an anticipated commencement date
Our perspective
Where a lease has around 80 to 82 years remaining, the practical question may be how quickly the lease is shortening compared with when the reforms will actually take effect. There is no guarantee that a particular deal or property sale can wait for the new calculation.
A valuation and a clear timetable can help homeowners decide whether beginning a claim now is worth the current premium or whether waiting is a reasonable commercial choice.
Should you extend now or wait for reforms?
There is no single answer for every leaseholder. Waiting could reduce some premiums if the reforms commence in the form currently envisaged. But delay can create practical costs, particularly where the remaining term is close to 80 years or a sale or mortgage is planned.
- Check the actual lease term. Obtain the commencement date and length from the registered lease, not a rough estimate.
- Understand the threshold. If your flat is close to 80 years, calculate when the term reaches the critical point.
- Ask about lending and resale. Mortgage providers have their own lease requirements, and a short lease may restrict the market.
- Budget for both scenarios. Seek advice on the premium under the current law and how reforms might change the calculation.
- Review transaction timing. Consider whether you need a sale, remortgage or estate-planning transaction to proceed before reforms commence.
- Consider negotiation. An informal offer can be compared with statutory rights, but should be reviewed carefully.
Do not assume that a lease becoming shorter will always result in a fixed financial loss. Valuation involves several factors and market movements. The important point is that the current statutory formula can change materially when the lease falls below the threshold.
Example: a lease has 81 years left
An owner has 81 years left on a flat’s lease and wants to remortgage within the next year. They have heard that marriage value is going to be abolished and decide initially to wait.
A specialist adviser explains that the new valuation rules are not yet operating and that the lease may fall below 80 years before a claim can be completed. The owner obtains a current valuation, reviews lender requirements and takes advice on whether to serve notice before the threshold is crossed.
This is not a prediction of the cost or timing of the reforms. The individual lease and valuation evidence are decisive.
Frequently asked lease extension questions
Is marriage value abolished in 2026?
No. The 2024 legislation provides for abolition when the relevant valuation provisions commence, but those provisions were not yet in force in November 2026. Under the current statutory formula marriage value may still be payable where a flat’s lease has fewer than 80 years remaining.
Can you extend a lease immediately after buying?
A qualifying flat leaseholder no longer needs to wait two years to own the property before starting a statutory extension claim. That ownership change took effect on 31 January 2025, but other eligibility requirements remain relevant.
Will a statutory extension add 990 years today?
Not yet. Under the current statutory route for a qualifying flat, a lease extension ordinarily adds 90 years and reduces ground rent to a peppercorn. The proposed 990-year standard requires the relevant reform provisions to come into force.
Does the same process apply to leasehold houses?
Not always. Rights and procedures for leasehold houses and flats can differ. Obtain advice specific to the property and the legislation that applies before assuming the flat statutory route is available.
How Britton and Time can help
Our residential leasehold solicitors can advise on statutory and informal extensions, notices, negotiations, valuation issues and the effect of current leasehold reforms.
If your lease is approaching 80 years, contact Britton and Time to discuss your remaining term, the likely process and what action may be appropriate for your circumstances.
We’re here to help.
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