What Does a Lease Extension Cost in England & Wales?
A statutory lease extension adds 90 years and zeroes ground rent, but the premium can vary by tens of thousands depending on years remaining. Here's what drives the number.
Quick answer: A statutory lease extension adds 90 years to your lease and reduces ground rent to zero. The premium you pay depends on the property's value, years remaining, and ground rent: typically ranging from a few thousand pounds on a lease with 85+ years left, to well over £20,000 once you're under 80 years, where "marriage value" kicks in.
What Is a Statutory Lease Extension?
Most leasehold flat owners in England and Wales have the legal right, under the Leasehold Reform, Housing and Urban Development Act 1993, to extend their lease by 90 years and reduce ground rent to a peppercorn (effectively zero). Since 31 January 2025, you no longer need to have owned the flat for two years before you can claim. Section 27 of the Leasehold and Freehold Reform Act 2024 abolished the old two-year ownership rule, and the change is retrospective, so a leaseholder can serve notice the day after completing a purchase. See our full step-by-step lease extension process guide for the eligibility criteria and notice timeline in detail. This statutory route is separate from any informal deal you might negotiate directly with a freeholder. It gives you a fixed valuation formula and a right to go to a tribunal if you can't agree a price. GOV.UK has a short overview of extending a lease, though the detailed premium mechanics sit in the 1993 Act itself.
What Determines the Premium You'll Pay?
Three things drive the number: how many years are left on the lease, the property's value once extended, and the ground rent you're currently paying. Surveyors use a "relativity" table to estimate what percentage of the freehold value a lease of a given length is worth, then capitalise the ground rent you're giving up (typically discounted at around 6% per year to a present value), to arrive at the base premium, before any marriage value is added.
Illustrative Cost Ranges by Years Remaining
These are indicative bands, not quotes. The actual premium always depends on the specific property's value, ground rent terms, and a surveyor's relativity assumptions. Run your own numbers through our lease extension calculator for a property-specific estimate.
| Years remaining | Marriage value applies? | Typical premium on a £300,000 flat |
|---|---|---|
| 95+ years | No | A few hundred to low thousands, mostly just the capitalised ground rent |
| 85-95 years | No | Roughly £2,000-£6,000 |
| 80-85 years | No (but close to the threshold) | Roughly £5,000-£10,000 |
| 70-80 years | Yes, 50/50 split | Roughly £15,000-£30,000+ |
| Under 70 years | Yes, 50/50 split | Can exceed £40,000, and mortgageability starts to suffer well before this point |
What Is "Marriage Value" and When Does It Apply?
Below 80 years remaining, the law requires you to also pay 50% of the "marriage value": the jump in the property's value created by extending the lease, split between you and the freeholder under the 1993 Act's Schedule 13 formula. This is the single biggest reason costs escalate sharply once a lease drops under 80 years, and it's why we tell every landlord we work with: extend before you hit that threshold, not after. The Leasehold and Freehold Reform Act 2024 does provide for abolishing marriage value entirely, but that part of the Act hasn't been brought into force yet. It needs secondary legislation setting new valuation rates first, so marriage value remains payable under the existing formula for now. Our process guide covers the current commencement status of the 2024 Act in more detail.
Professional Fees: The Cost Beyond the Premium
The premium itself is only part of the bill. Under the statutory process, you're also liable for the freeholder's reasonable valuation and legal costs, on top of your own. Budget roughly:
- Your surveyor: typically £700-£1,500+ for the initial valuation, more on a high-value or contested property.
- Your solicitor: typically £1,000-£2,000 for handling the statutory notices and completion.
- The freeholder's reasonable costs: their surveyor and solicitor fees, which you're statutorily liable for, often another £1,000-£2,500 combined, sometimes more if the freeholder is unresponsive or disputes the claim.
On a lease with 95+ years remaining and a low premium, professional fees can end up costing more than the extension itself, worth factoring in before you assume a "cheap" extension is actually cheap once fees are added.
How Long Does the Process Take?
Realistically 4-9 months from serving the initial Section 42 notice to completion, longer if the freeholder is unresponsive or the price is disputed at the First-tier Tribunal (Property Chamber).
Our Approach
We run the numbers through our own lease extension calculator before we make an offer on any short-lease flat, because the premium can materially change what the deal is actually worth once extended. It's one of the most commonly mispriced variables we see other buyers get wrong: a flat that looks cheap at 68 years remaining can absorb most of its apparent discount in marriage value alone.
This article is for general information only and isn't legal or financial advice. Premium calculations depend on individual lease terms, valuation assumptions and current case law, and can vary significantly from the illustrative figures here. Get a RICS valuer's premium estimate and a leasehold solicitor's advice before making an offer or serving notice.