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Lease extension calculator
Lease extension calculator
How we can help with your lease extension
Frequently asked questions
A lease extension is the process by which the term of a leasehold property is lengthened, usually by adding a set number of years to the existing lease. It is typically pursued to increase the value and marketability of the property, and in many cases is carried out under statutory leasehold enfranchisement rights.
The cost of a lease extension premium is generally based on a statutory formula that reflects the diminution in the landlord’s interest, the loss of future ground rent, and, where applicable, the marriage value created by the extension. Factors such as the current length of the lease, the value of the property, and ground rent all feed into this calculation.
A lease extension should be considered before the remaining term becomes too short, as extension costs rise as the lease runs down, and shorter leases can affect market appeal and access to mortgage finance.
Factors that influence the lease extension premium estimate include the current market value of the property, the number of years left on the lease, the ground rent payable, and underlying valuation assumptions built into the calculator such as discount or deferment rates.
Yes. The shorter the remaining lease, the more expensive it usually is to extend. Costs tend to rise as the lease runs down, especially once it drops below key thresholds that significantly increase the valuation.
- The calculator gives you the approximate premium payable for a lease extension.
- This is based on the Leasehold Reform Housing and Urban Development Act 1993.
- The calculation assumes the new lease
- will be for 90 years on top of the existing unexpired term
- will be granted at peppercorn future ground rent
This is the annual rent paid to your landlord, and it can be found on your latest rent request or in your lease. The calculator only requires the ground rent amount, not the service charge amount.
This refers to the number of years left to run on your lease.
This is the value of the new extended lease. This value excludes any value attributable to improvements made by the leaseholder.
