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Leasehold Extensions

Reasons to choose Wilson Browne

A lease extension is an application that allows the leaseholder to extend their current lease by a period of up to 90 years, providing you meet the requirements.
There are two types of lease extensions;

– Statutory lease extensions
– Voluntary lease extensions

Read our guide: leasehold extensions – a guide to terminology

Wilson Browne can assist in giving specialist advice throughout the life of a lease extension in the following areas:

– Checking your eligibility to extend to lease
– Identifying the ‘competent landlord’
– Instructing a surveyor
– Assessing the premium
– Preparing the Notice
– Negotiations
– Drafting the lease
– Reviewing the lease
– Registration of the new lease
– Assistance with applications to the First-Tier Tribunal

Below is a list of frequently asked questions that may help to aid any enquiries you have regarding lease extensions.

Are you eligible?

To apply for a statutory lease extension, under the Leasehold Reform, Housing and Urban Development Act 1993, leaseholders are entitled to extend their lease providing they have had ownership in excess of two years and the original lease was granted for 21 years or more, this is known as a ‘long lease’.
Any application made prior to a two year ownership, does not require the freeholder to agree. This results in a voluntary lease extension and would require negotiations between the leaseholder and the freeholder.

What is a statutory lease extension?

This is the definition given to the legal right to extend having had legal ownership for a period of two years or more.
It gives the leaseholder a 90 year extension, which is added to the term that is unexpired from the current lease.
For example, if your current lease has 80 years remaining a statutory lease extension would provide you with a new term of 170 years.
A statutory lease extension also resets the ground rent to what is known as ‘peppercorn rent’.

Who is the competent landlord?

If a property is registered then a search of the Land Registry entries will identify who the freeholder of the property is. If the property is still unregistered then it may be necessary to do a little more investigation to confirm the identity of the competent landlord.
Essentially, the competent landlord is the freeholder of the property.

Ground rent and lease extensions

A lease normally sets out how much ground rent is to be paid and how often it is to be paid. In many leases, ground rent increases every few years.
The Leasehold Reform Act 1993 provides that the extension diminishes the ground rent to a ‘peppercorn rent’ which allows the leaseholder to decrease the ground rent paid for the term remaining on the lease.
Peppercorn rent is a nominal or small rent. This is attractive to a new buyer as the extension has already been made and the ground rent has been reduced.


Wilson Browne has relationships with experienced surveyors who can provide a valuation for your lease extension. We can provide you with details to contact them independently or contact the surveyor on your behalf.
We strongly recommend having a full valuation prior to making proposals for the premium payable. There is no fixed fee for a lease extension, and a valuation will provide the minimum and maximum guides for the rate you could pay. This is vital to ensure you have no surprises throughout the transaction.
The valuation will take into consideration the local area, the landlord and tenant’s position and any counter-claims that could occur.
From the information you receive, you can make an accurate decision as to what figure you wish to propose for the premium.

How do you extend? What is the process?

The lease extension process has some strict time-limits to be kept to this is why it is vital to obtain expert advice and assistance. It is important to appoint a solicitor to ensure matters are conducted properly and that your application is approved and registered in the right manner.
Whether you are a tenant applying for the extension or a landlord receiving an extension request, it is necessary to obtain a valuation.
Once a valuation is obtained the process begins with service of a formal Notice, known as a S.42 Notice, by the tenant on the landlord, confirming that the wish to extend their lease and put forward the price they propose to pay for the lease extension.
A period of between two and six months is allowed for negotiations on the value of the lease extension. If an agreement cannot be reached then an application to the First Tier (Property Chamber) should be made for a determination of the value of the lease extension.
If no application is made before the deadline the extension application is considered withdrawn, this would then mean the whole process would have to start again.
It is sometimes possible for the tenant to contact the landlord and make informal enquiries about the extension of the lease. This can avoid service of the statutory notices and may be appropriate if the leaseholder has a good relationship with the freeholder or wants to explore the likely cost of extending the lease without starting the formal process.
Once a price is agreed or adjudicated, a new lease can be prepared. The new lease – setting out the newly agreed terms – is approved by the parties, the lease extension premium is paid and the lease is then registered with HM Land Registry.

When should you extend?

It is worth considering renewing your lease as soon as possible.
It is most preferable to do so, before 80 years remains to avoid paying ‘marriage value’ on the premium. If you renew prior to 80 years left on the lease, ‘marriage value’ does not apply.
Your lease is an asset that is decreasing with time, as the shorter the lease the lower the value in the property. You should consider making an application for an extension, before the lease becomes challenging to mortgage. A short lease will have consequences for re mortgaging and new mortgages.
This may be particularly relevant if you wish to sell your property as many lenders will not provide funding for leases of less than 70 years and a short lease may therefore hinder your prospective market.

What is marriage value?

If you renew a lease with less than 80 years left the leaseholder has to pay to the freeholder ‘marriage value’. Marriage Value is 50% of the increase in the value of the property as a result of a longer lease.
For example;
If the property was worth £80,000.00 and the lease extension made the property worth £100,000.00 the leaseholder would pay a Marriage Value fee of £10,000.00

Mortgages and leases

Whilst it is still possible, to buy and sell a property with a short lease, many lenders will not lend on a property with a short lease, and many refuse on leases less than 70 years.

Whilst there will be lenders who will provide funding, a shorter lease limits the market for

More information about lenders and obtaining a mortgage on a leasehold property can be found here

Shared ownership and lease extensions

If you have a shared ownership property, you do not own the whole lease. Therefore, in order to make an application for a lease extension, you must first staircase the property to full ownership.  

Executors and extensions

Executors have the right to apply for a lease extension, providing that they apply within two years of the date of the grant of probate.

If you are the executor of an Estate, you may wish to apply for a Lease extension on behalf of the deceased tenant. This can be a useful tool for increasing the value of the Estate. It is usually possible to pass the benefit of the lease extension Notice on to the buyer by assigning it rather than requiring the Estate to pay the premium to extend the lease.

Leasehold Disputes

If you have been unsuccessful in reaching an agreement with the freeholder you would need to apply to the Leasehold Valuation Tribunal to reach a decision in relation to the costs of your premium.

Wilson Browne can assist you at the stage and provide advice and representation.


Our charges for advising on a lease extension range from £750 plus VAT to £900 plus VAT.  You will also need a professional valuation of the extension – a report is likely to cost in the region of £400 plus VAT to £650 plus VAT.

If an application to the First-Tier tribunal is necessary are costs are changed on the basis of time incurred.

You are responsible for your own solicitor and surveyor’s fees as well as reasonable solicitor and surveyor’s fees from your Landlord.

At Wilson Browne, we provide specialist advice and recommend that you contact us as soon as possible. Ensuring we provide all the help you need from the earliest opportunity.

For further information about extending your lease or dealing with a Notice served by a tenant contact our expert team.  Additional information can be found here

More information about lenders and obtaining a mortgage on a leasehold property can be found here