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Residential leasehold specialist If you own a leasehold flat, you may be asking: Should I extend my lease or wait for further reform?
It’s an understandable dilemma. The Leasehold and Freehold Reform Act 2024 (“the 2024 Act”) finally became law after years of political debate. Yet it stopped short of introducing some of the most anticipated changes, including a cap on existing ground rents. At the same time, the government has pledged further reform and to implement outstanding recommendations from the Law Commission.
The result? Uncertainty. And uncertainty makes many leaseholders hesitate. But in property, hesitation often carries a cost.
Why lease length matters more than politics
When deciding whether to extend your lease or wait, the political landscape is less important than one simple fact: how many years remain on your lease.
Once a lease falls below 90 years, it can start to affect marketability. Buyers become cautious. Lenders tighten criteria. As the term shortens further, the impact becomes more pronounced.
The most critical threshold is 80 years. If your lease drops below that point, “marriage value” becomes payable under current law. Marriage value reflects the increase in the property’s value created by the extension—and a share of that uplift must be paid to the freeholder. This can significantly increase the premium.
The government’s overview of the current lease extension framework is available here.
What did the 2024 Act actually change?
The 2024 Act introduced reforms designed to make lease extensions simpler and fairer over time. However, not all provisions are fully in force, and some require further regulations before they take effect.
Importantly, the 2024 Act did not overhaul the entire system. Nor did it immediately eliminate the cost structures that affect most leaseholders today. That’s the gap between headlines and reality. While reform is underway, it has not yet fundamentally altered the financial dynamics of extending an existing lease.
There is also no confirmed timetable for further sweeping changes. Even if new legislation is introduced, implementation can take years. Property law rarely moves quickly!
Will leasehold be abolished?
There has been strong rhetoric around abolishing leasehold, particularly for new-build houses. But reforming or replacing millions of existing residential leases is far more complex.
Leasehold arrangements sit within a network of rights and financial interests involving freeholders, lenders, managing agents, and insurers. Untangling that framework requires careful legislation and, in many cases, cooperation among leaseholders – often more difficult than you may think.
The government has expressed support for revitalising commonhold, in line with the Law Commission’s proposals. However, large-scale conversion from leasehold to commonhold would require coordination and funding at building level. That is not a quick fix.
Realistically, leasehold will remain part of the property landscape for the foreseeable future. Waiting for abolition is not a strategy—it is speculation.
See my earlier article: Commonhold and leasehold reform: Where are we?
The financial reality of waiting
Lease extensions do not become cheaper with time under the current system. As the term shortens, the premium generally increases. The closer you get to 80 years, the sharper the increase can become.
There is also the practical issue of saleability. A shorter lease narrows your pool of buyers and may complicate refinancing. Even if reform eventually reduces costs, there is no guarantee it will take effect before your lease term creates financial pressure.
Many leaseholders hope that reform will dramatically reduce extension premiums. That may happen in certain respects over time—but it is far from guaranteed, and the timing is uncertain. In contrast, extending sooner provides certainty. It removes ground rent, protects value, and prevents marriage value from becoming payable if you act before the 80-year mark.
When might waiting be reasonable?
If your lease still has well over 95 or 100 years remaining, you are in a stronger position. In that scenario, you may have the flexibility to monitor how reform develops without immediate financial risk. However, if your lease is edging toward 90 years—or worse, toward 80—delay becomes progressively harder to justify from a financial perspective.
The key question is not whether reform is coming. It is whether you can afford the consequences if it arrives later than expected.
So, should you extend your lease or wait?
For many leaseholders, particularly those below 90 years, acting sooner provides control and financial clarity. Waiting means accepting uncertainty and the possibility of a higher premium. Political reform may eventually reshape the system. But your lease clock keeps ticking in the meantime.
If you are unsure, start by establishing exactly how many years remain and obtaining a professional assessment of likely extension costs. Once you understand your position, the decision becomes far clearer. In leasehold matters, timing is not just important—it can be the difference between a manageable cost today and a much larger one tomorrow.