Should you extend your lease before selling?
Extending your lease before selling can make a flat easier to finance and more attractive to buyers. It is not always the best use of your money or time. The decision depends on the remaining term, the ground rent, the full extension cost and how soon you need to move.
For a leasehold flat in Shad Thames, Borough or elsewhere in SE1, start by comparing two realistic sale options: the property with its current lease, and the property with an extension completed. A higher asking price alone does not mean the cost will pay off.
Why buyers care about the length of the lease
A lease gives ownership rights for a limited period of time. As the remaining term gets shorter, buyers consider the cost of extending it and whether they can obtain a mortgage on acceptable terms.
There is no single mortgage cut-off that applies to every lender. Requirements can depend on the years remaining at purchase, the years remaining at the end of the mortgage and other lease terms. Ground rent terms can cause problems even where the lease is long.
A cash buyer may accept a shorter lease, but can still price in the cost and uncertainty of an extension. Being able to sell does not necessarily mean you can reach the same buyers or achieve the same price as a comparable flat with a longer lease.
Why the 80-year threshold is important
Under the current statutory rules, marriage value is payable where a flat’s lease has 80 years or fewer remaining at the relevant valuation date. It is an additional part of the premium that reflects the increase in the combined value of the landlord’s and leaseholder’s interests following an extension.
The Leasehold and Freehold Reform Act 2024 included provisions for the abolition of marriage value. However, passing an Act and all its provisions coming into law are separate steps. As of 30th September 2026, the abolition has not taken effect.
If your lease is just above 80 years, seek urgent specialist advice. The relevant date for a statutory claim is generally when a valid Section 42 notice is served, rather than when you first ask for a quote or instruct an estate agent. Your solicitor should handle the notice and deadlines. For more details on marriage value and the valuation date, you can read the information on the Leasehold Advisory Service website.
What has changed and what is still pending
The two-year ownership requirement was removed on 31 January 2025. A qualifying buyer no longer needs to have owned the flat for two years before starting the lease extension process. However, eligibility and the legal process still matter – the extension is not automatically granted on completion.
The existing statutory route for qualifying flats generally adds 90 years to the remaining term. It also reduces ground rent to a peppercorn, effectively zero.
The 2024 Act’s wider changes, including 990-year extensions and the new valuation arrangements, have not yet been implemented. The Government’s September 2026 guidance says technical regulations and further legislation are still needed.
The proposed £250 annual cap on ground rents in older residential leases, followed by a peppercorn after 40 years, is a separate proposal. It should not be treated as an existing limit on your ground rent or a guaranteed saving by a particular date. See the Government’s explanation of the pending reforms.
Compare the full cost with the likely sale benefit
Ask a surveyor experienced in lease extensions to estimate the premium. Get an estimate of the legal fees as well, including the landlord’s reasonable legal and valuation costs payable under the current statutory process. Check what other charges may apply.
Then ask your selling agent to estimate likely sale prices with and without the extension. Keep the figures separate:
- The likely sale price with the current lease.
- The likely sale price after extension.
- The total premium and professional costs.
- The cost and practical consequences of delaying your move.
If your main aim is a better financial return, the difference between the two sale prices needs to justify the cost. An extension may also improve the prospects of finding a buyer using a mortgage, but neither the price uplift nor the sale is guaranteed.
When extending before sale may be worthwhile
An extension is worth considering when the current lease restricts mortgage options, or when buyers would face a substantial extension premium, or when the term is approaching 80 years.
Completing the extension before marketing the property removes uncertainty for your buyers. They can assess the property with the extended lease in place rather than rely on a proposed deal to extend it. This may be worthwhile if you have the funds and enough flexibility over your moving date.
If you already own a share of the freehold, check the flat’s lease anyway. You may be able to agree an extension with the other freeholders, but their consent and the proper legal documentation are still needed.
When selling with the current lease may be sensible
If the term is comfortably long and the ground rent terms are acceptable, an extension purely to support a sale may add little value. Check the position before paying for work that buyers do not require.
If you need to move soon or cannot fund an extension up front, you should consider selling at a price that reflects the existing lease. Otherwise, buyers will need to take their own advice on eligibility, funding and costs, and may want a larger discount than the estimated premium to allow for fees.
It may also be possible to coordinate an extension with completion. Ask your solicitor whether this could work for your property and the buyer’s funding, rather than offering it as a certainty in the listing.
Should you wait for further reform?
Waiting could benefit some owners, particularly where marriage value currently applies. Future costs will still depend on the final valuation rules and the individual lease, and there is no guaranteed implementation date to plan around.
If you can postpone selling, discuss this with a specialist. If you are close to 80 years or need to move, assess the options available now rather than assuming future reform will solve the problem in time.
Be cautious with informal offers from a freeholder; compare the premium, the additional years, the ground rent and any changed clauses with those under the statutory route. A cheaper headline offer is not enough to judge the terms.
When you are ready, book a free sales valuation with Hastings International, and let us know about the remaining lease and details of the ground rent. We can discuss your flat’s market position and how the lease will affect the value.
