Lease Extension Premium Calculator

A statutory extension under Chapter II of the Leasehold Reform, Housing and Urban Development Act 1993 gives you your existing term plus 90 years at a peppercorn rent, and Schedule 13 sets what you pay for it. The premium has three parts. The term is the ground rent the freeholder gives up, valued as an income stream over the years left to run and capitalised at a yield. The reversion is the freeholder's right to get the flat back when the lease ends, valued by discounting the flat's value back over the unexpired term at the deferment rate. Marriage value is the uplift in total value that the new lease creates, and where it applies the freeholder takes half of it.

The 80-year cliff is the single most expensive date in leasehold. Schedule 13 treats marriage value as nil only where the unexpired term exceeds 80 years, so a lease at 80 years and one month pays none and a lease at exactly 80 years pays half the uplift to the freeholder. Because relativity falls away faster as the term shortens, that uplift is not a small number: crossing the line can add several thousand pounds to a modest flat and considerably more to an expensive one. The valuation date is the date your section 42 notice is given, not the date the extension completes, so serving the notice before the term crosses 80 locks in the cheaper basis while you negotiate.

Marriage value still applies in 2026, whatever you may have read. The Leasehold and Freehold Reform Act 2024 does abolish it, and the freeholders' judicial review of that abolition was dismissed in October 2025, but abolition on the statute book is not the same as abolition in force. Commencement needs regulations the government has not made. Only three commencement instruments exist under the Act, and none of them touches the valuation provisions, so on legislation.gov.uk the removal of Schedule 13 still sits under changes yet to be applied. A claim served today pays marriage value in full. The same goes for the 990-year term: an extension completing now is your term plus 90 years.

The three rate knobs are where valuers actually argue. The deferment rate has stood at 5% for flats since the Sportelli decision, and it stays the working rate because the 2024 Act power to prescribe rates is not in force, with the consultation on those rates closing on 23 September 2026. The capitalisation rate applied to the ground rent usually lands between 6% and 8% for a modest fixed rent. Relativity, the short-lease value as a percentage of the long-lease value, is the loosest of the three: the published graphs disagree with each other by several percentage points at the same term, and every percentage point moves the marriage value directly. Our figure is a simplified approximation of the published graph family, which is why the headline is a range and why your own valuer's relativity is worth having.