Search
HomeOwners Alliance logo

Sign up to our newsletter for the latest property news, tips & money saving offers

  • Advice for every step of buying a homeSee our step-by-step guide

Should I extend my lease?

If your leasehold is getting short – below the critical 80 year point - don’t despair. You have a legal right to extend it. However it is a costly process. So we look at the reasons why you might extend your lease as well as the circumstances which might stop you from undertaking a lease extension.

What is the cost of selling a home

UPDATE:  In January 2021, the government announced its intention to change the lease extension process to make it easier and cheaper for leaseholders of both flats and houses.  To find out more about the proposals and how it might affect leaseholders today take a look at our voice piece, Leaseholders could ‘save thousands of pounds’ under new government reforms.

What does extending the lease actually mean?

Your leasehold has a certain term or length (such as 85 years), at the end of which the property will revert to the freeholder. It is a totally unfair relic of feudal laws, which you avoid by adding extra years to the length of your lease – that is, extending your lease.

Should I extend my lease? 

Before you enter the costly legal process of a lease extension, you need to decide whether it is worth the effort and expense. As a general rule of thumb, if the lease is less than 90 years you should almost certainly try to extend it because:

  • Properties with shorter leases are less valuable than ones with long leases (this is particularly true if leases are below 80 years)
  • Properties with shorter leases can be more difficult to get a mortgage on, because mortgage companies will worry that its value might decline and so won’t be good security
  • Properties with shorter leases can be more difficult to sell

Want to know how much your lease extension will cost? Our partnered lease extension solicitors can give you a free estimate and provide advice you can rely on. Click here to find out more and speak to them today

Why would I not want to extend the lease?

Depending on your circumstances, it might not be worth getting involved in the expense and hassle of extending your lease if:

  • You have a long lease already (over 90 years), there is probably little benefit to extending it (unless you want to get rid of the ground rent)
  • You are strapped for cash and mortgaged to the hilt. Lease extensions can be very expensive (many thousands of pounds), so you need to work out first whether you can afford it.
  • You are only planning to be in the property a couple of years before moving on (unless you need to extend the lease to make it attractive to buyers)
  • You plan to buy the freehold in its entirety (owning the freehold of a house makes the question of extending the lease redundant; in the case of flats, leases may still need to be extended but if you and your neighbours are the freeholder it is easier and cheaper to do this)
  • You are not likely to outlive the term of the lease. It can be quite rational just to let your heirs inherit the problem

If you do want to extend – act quickly!

As the lease gets shorter, the cost of extending it gets more expensive at an exponential rate. This is particularly true for leases of less than 80 years, where the cost of lease extension really starts to bite.

At about 60 years, the cost of extending the lease increases by about 1% of the value of the property each year – i.e. if the property is worth £250,000, the bill for extending the lease will go up about £2,500 a year. When the leasehold gets down to zero years, it is practically valueless as the whole property reverts to the freeholder (though for a certain period after expiry of the lease you may still have a right to extend the lease).

So, if the term of your lease is less than 80 years, you should act as quickly as possible before it gets too expensive. And if your lease is less than 90 years, you should act quick enough to ensure you don’t end up with a lease of 80 years!

Am I allowed to extend my lease?

Yes – if you’ve owned the property for at least two years you are entitled to demand a 90 year extension to be added to your existing lease from your freeholder. You only have to have owned the property, so you can still apply if you’ve been living somewhere else. If you have owned the property for less than two years then:

  • You can still enter a non-statutory agreement with the freeholder, if you can persuade them. Although be aware that informal lease extensions like these can come with risks. See our step by step guide to lease extension for more details of why a formal (or statutory) lease extension offers most protection
  • If the person you bought your property from had started the lease extension process, they might be able to continue it – but you will have had to ensure that the right was passed on to you when you bought the property

If none of this applies – you simply have to wait two years.

Want to know how much your lease extension will cost? Our partnered lease extension solicitors can give you a free estimate and provide advice you can rely on. Click here to find out more and speak to them today


Leave a comment (20)* Required

  1. Pat HillPat Hill

    After 2 years my lease extension has finally come through. There is however an error as my house is referred to as a flat, over two floors. The original lease quite clearly describes it as a town house. My solicitor and the management company who read the draft copy, refuse to take responsibility for this error and insist I pay a further £200 to get it amended. How should I take this forward?

  2. Steven BullSteven Bull

    I have 47 years lease left,I own the property not the land, what should I do,

  3. EricaErica

    What is the maximum number of years I can add on to my lease? Is it 90 years or more?

    Many thanks

  4. AF AlamAF Alam

    I have 85 years on my lease and wish to extend. Is there any legal insurance available for lease extensinos?

  5. Christopher masonChristopher mason

    Our lease is now just for 62yrs.
    should we wait for these proposed new government reforms ???
    ie fairer prices, no marriage value .longer lease
    THANKS

  6. AlizaAliza

    Hot Bbw Mother Masturbating Fat Bbbw Porn00

  7. Anita MaciejewskiAnita Maciejewski

    How long does it take to extend the lease

  8. KateKate

    Do you have any updated news on the proposed changes to lease extension costs ….ie reform of the law. Thank you

  9. Angela SmithAngela Smith

    My property was valued at £320,000. Just found out have 82 years on lease. How much would it cost to extend it.

  10. GeorgeGeorge

    Have a chance to buy a leasehold flat. But have been told by seller I would probably have to extend. But I just want to live in it till I die aged 55. Do I need to extend

    • Sara HindSara Hind

      Hi George, have you read our article? It gives some of the reasons why you might decide not to extend the lease.

  11. Pamela BlackPamela Black

    I live in a retirement property, which I own, and have asked the management company to extend the lease as it now only has around 68 years left. The management company have now come back to me and advised that the lease cannot be extended (reason not explained) but they can provide me with a new 99 year lease (same length as original lease). By doing this the management company will still be able to charge me ground rent at £100 p/a. Having read your literature on the matter and other publications surrounding the subject of lease extensions I wonder what the circumstances would be where the management company could not extend my lease by 99 years thus giving me a 167 year lease (ie 99+68) and reduce my ground rent to zero. Thank you in advance of your advise.

  12. My mother is considering to buy two bedroom maisonette house but the leasehold is only 40 years,by how many years can she extend the lease?

  13. Maureen RyanMaureen Ryan

    I own part of the freehold of the flat that I own and it has approximately 72 years left on the lease as I am part of the freehold how can I extend it and how much will it cost me?

    • AnnieAnnie

      Hi Maureen,

      Please take a look at our guide on extending your lease. It has a helpful calculator which can estimate how much it will cost you.

      Thanks,

      Annie
      HomeOwners Alliance Team

  14. Steve KeaneSteve Keane

    I have recently had an offer to buy a leasehold property accepted. The flat was a freehold previously. After a six month wait, the seller’s attempt to register the property as a leasehold was rejected. I am not yet sure why it was rejected, but I have been told I can still buy the property and move in. I would then have to apply for a leasehold myself.

    What are the consequences of living in an unregistered property? Is this common practice?

  15. raymond brownraymond brown

    There are 4 flats in a grade2 listed building .3 flats have approx 83years left on their lease.The elderly free holder lives in the groundfloor flat 4.Can we extend the leases or better still buy the freehold

  16. Denise TromanDenise Troman

    My 83 year old Mothers house has 60 years lease left
    She cannot afford to extend it
    What consequences will the short lease have when I sell the property?
    It will placed in my name as per her last will indicates

  17. Bonallack and BishopBonallack and Bishop

    For sure, if you have just over 80 years left on your lease, you will want to try and extend it as soon as possible. When you go past this, the marriage value comes into effect and you’ll end up paying an added fee.

close popup ×

Before   you go...

If you found this website useful, could you spare a minute to leave us a review?

Reviews.io
×