Leasehold · 5 min read
Why 80 years is the number that matters on a lease
Once a lease falls below 80 years, the cost of extending it rises sharply and permanently. Here is why, and what to do about it.
Kerr
Conveyancer
A lease is a wasting asset. Every year that passes shortens the term you own, and below a certain point the market begins to price that shortening far more aggressively than most owners expect.
The critical threshold is 80 years. Once the unexpired term drops below it, the premium payable to extend the lease includes "marriage value": broadly, half of the increase in the value of the flat created by the extension itself, paid to the freeholder. That single change can add thousands of pounds to the cost overnight.
Lenders take the same view. Many will not lend at all where the remaining term is under roughly 70 years, and some require the term to exceed the mortgage term by a substantial margin. A short lease therefore narrows your pool of buyers at exactly the moment you want to sell.
If you have owned the flat for at least two years, you have a statutory right to a 90-year extension with the ground rent reduced to a peppercorn. The valuation date is fixed by the date the formal notice is served, which is why acting before the term crosses 80 years, rather than after, is usually the single most valuable decision a leaseholder makes.
Find out what extending your lease would cost
Send us the flat address and the years remaining. We will confirm the process, the likely premium and our fixed fee.