Leasehold
Consider Soon

Lease Extension Calculator

Estimate the cost to extend your lease using the statutory formula. Includes marriage value calculation for leases under 80 years.

AI-Powered
Free to use
Property details
Enter your leasehold details

Family connection affects marriage value

Consider Soon: Approaching 80-year threshold

Only 2 years until marriage value applies

Lease position
Visual representation
Current lease: 82 yearsRelativity: 88%
<70 yrs
Critical
70-79 yrs
Marriage Value
80-89 yrs
Consider Soon
90+ yrs
Not Urgent
Extension cost estimate
Based on statutory formula
Estimated Premium

£3,824

Payable to freeholder

Total Cost

£7,824

Including professional fees

Value Uplift

£38,500

Increase in flat value

Net Gain

£30,676

Profit from extending

Premium Breakdown

£3,824

Capitalised ground rent:£3,824

Return on Investment

392%

Value gained per pound spent on extension

Full Cost Breakdown

Premium to freeholder£3,824
Your surveyor fees£1,500
Your legal fees£1,500
Freeholder's costs (you pay)£1,000
Total estimated cost£7,824

Value Comparison

Current lease value (88%)£308,000
Extended lease value (99%)£346,500
Value uplift+£38,500

Important Notes

  • • This is an estimate only - get a professional valuation
  • • Leasehold reform may change how premiums are calculated
  • • You must have owned the flat for 2+ years to qualify
  • • The freeholder may challenge with a higher valuation
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About the Lease Extension Calculator

What it does and how it helps you

The Lease Extension Calculator estimates the statutory premium to extend your lease under Section 42 of the Leasehold Reform Act 1993. For leases under 80 years, marriage value becomes payable to the freeholder, significantly increasing costs. This calculator uses the statutory valuation formula including capitalised ground rent, reversion value, and marriage value (if applicable) to estimate your total extension cost including professional fees.

Calculate statutory premium under Section 42 notice
Include marriage value for leases under 80 years
Estimate total costs including professional fees
Show value uplift and ROI from extending

How It Works

Understanding the calculation method

The calculator uses the statutory lease extension formula: 1. Capitalised Ground Rent - Calculates the present value of ground rent payments over the remaining lease term using a capitalisation rate (typically 6-7%) 2. Reversion Value - Determines the present value of the property reverting to the freeholder at lease expiry, discounted at the deferment rate (5% for flats per Sportelli case) 3. Marriage Value - For leases under 80 years, calculates 50% of the uplift in value created by extending the lease (extended value minus current value minus freeholder's loss) 4. Professional Costs - Adds surveyor fees, legal fees, and the freeholder's reasonable costs The calculator uses relativity graphs based on Savills/RICS data to determine the percentage of freehold value your current lease represents.

When to use this calculator

Use this calculator when your lease has fallen below 90 years to understand the cost of extending. It's particularly critical for leases approaching or below 80 years, as marriage value adds significant cost. Essential for purchase negotiations on short leases, planning lease extension timing, and understanding whether to extend before selling. Always extend before 80 years if possible to avoid marriage value.

Frequently Asked Questions

Common questions about this calculator

When a lease drops below 80 years, 'marriage value' becomes payable. Marriage value is the increase in property value created by extending the lease, and leaseholders must pay 50% of this to the freeholder. This can add tens of thousands to the extension cost. Above 80 years, no marriage value is payable, making extensions significantly cheaper.
Costs vary dramatically based on lease length, property value, and ground rent. For a £350k flat with 82 years remaining, expect £8-15k. At 72 years, this could rise to £30-50k due to marriage value. Professional fees add £4-8k. Always extend before 80 years if possible - the cost increases exponentially as the lease shortens further.
Section 42 of the Leasehold Reform Act 1993 gives qualifying leaseholders the statutory right to extend their lease by 90 years at a peppercorn (zero) ground rent. You must have owned the flat for 2+ years. The process involves serving a Section 42 notice with your premium offer, the freeholder's counter-notice, negotiation, and potentially First-tier Tribunal if you can't agree on price.
If you can't agree on the premium, either party can apply to the First-tier Tribunal (Property Chamber) to determine the price. You'll need a RICS surveyor's valuation report. The Tribunal will consider comparable evidence and technical valuation arguments. Most cases settle before Tribunal through negotiation, as Tribunal proceedings add time and legal costs.
Yes - the Leasehold and Freehold Reform Act 2024 is set to abolish marriage value, cap ground rent at peppercorn rates, and simplify the valuation formula. This will significantly reduce extension costs, especially for leases under 80 years. However, existing Section 42 rights remain available under current rules until the reforms are fully implemented.

Related Property Terms

Section 42 lease extensionMarriage value calculationLease extension premium80 year lease ruleFirst-tier TribunalRelativity valuationCapitalised ground rentDeferment rate SportelliSection 42 noticeLeasehold Reform Act 1993