How much does it cost to extend a lease?
Short answer
There is no fixed price. You pay a premium calculated from the remaining term, the ground rent, capitalisation rates and — while the lease is under 80 years — marriage value, plus professional costs on both sides. Below 80 years the premium rises sharply, so act before that threshold.
A statutory lease extension adds 90 years to your existing term and reduces the ground rent to a peppercorn, in exchange for a premium paid to the freeholder. The premium is a valuation exercise, not a published fee, which is why two flats in the same block can attract very different figures.
What drives the premium
- Unexpired term — the shorter the lease, the more the freeholder’s reversion is worth, and the more you pay.
- Ground rent — a high or escalating rent increases the capitalised value being bought out.
- Capitalisation and deferment rates applied by valuers.
- Marriage value — the uplift in the flat’s value created by the extension, currently shared with the freeholder once the lease falls below 80 years. This is the cliff edge: crossing it can add many thousands of pounds.
Budget also for both sides’ valuation and legal costs, which you are generally responsible for under the statutory route.
The process and the timing
You serve a Section 42 notice claiming the statutory right; the freeholder must respond with a counter-notice within two months; you then negotiate, or refer the premium to the First-tier Tribunal. Expect six to twelve months where negotiation succeeds, and 12 to 18 months if a tribunal hearing is needed. An informal extension offered privately by the freeholder can complete in two to four months, but you lose the statutory protections — the freeholder can attach conditions, keep a ground rent, and charge extras.
The freeholder cannot refuse a qualifying claim; they can only dispute the premium and the lease terms.
Should you wait for reform?
The Leasehold and Freehold Reform Act 2024 will extend the new term to 990 years, remove the two-year ownership requirement and abolish marriage value, but its provisions are being commenced in stages. If your lease is comfortably above 85 years and you have no plans to sell, waiting may save money. If it is near or below 80 years, delay is expensive — and below about 70 years many lenders will not lend at all, which makes the flat hard to sell.
Related guides
Lease Extension: Your Statutory Right and the New 2024 Rules
If your flat has a lease, the term is finite — and once it falls below 80 years the cost to extend rises sharply because of 'marriage value'. The Leasehold and Freehold Reform Act 2024 makes lease extension cheaper and easier, but most rules are still being commenced through regulations. This guide explains the law as it stands now, the major changes coming, and the practical process.
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Leasehold and Freehold Reform Act 2024: What Changed
The Leasehold and Freehold Reform Act 2024 (LFRA 2024) received Royal Assent on 24 May 2024 — the largest reform of leasehold law in over thirty years. The Act overhauls lease extensions, enfranchisement, service charges, and ground rents. Much of it requires secondary legislation before it takes effect, so the commencement timetable matters as much as the headline reforms. This guide walks through each major change and where it stands.
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Ground Rent: The Old Rules, the New Rules, and What You Can Challenge
Ground rent has caused some of the worst leasehold scandals of the last decade — doubling clauses that turn a £250/year rent into £8,000/year, and onerous clauses that make properties unsaleable. The Leasehold Reform (Ground Rent) Act 2022 banned ground rent on most new leases; existing leases are the subject of an ongoing consultation that may cap or buy out existing ground rents.
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Leasehold and Service Charge Disputes
Owning a leasehold property means owning the property for a fixed term while the freehold — the land — is owned by someone else (the freeholder or landlord). Leaseholders pay ground rent (now largely abolished for new leases) and service charges for the maintenance and management of the building. Disputes about service charges, management quality, and lease terms are common, but leaseholders have legal rights and access to the First-tier Tribunal (Property Chamber) to resolve them.
11 min
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