Buying a leasehold flat with a short lease: what to know before you offer

Treat the unexpired term as part of the price. Below about 80 years, a flat gets harder to mortgage and the statutory premium to extend the lease starts to include marriage value. Below about 70, both effects get worse. Before you offer, ask for the term, any extension notice already served, three years of service charge accounts and a current valuation — and get a solicitor and a RICS valuer on the file before contracts, not after.

What "short" means in practice

There is no statutory definition of a short lease. Two things set the market convention around 80 years.

The first is lending. Most mainstream lenders want a meaningful margin above the mortgage term at the end of the lease; many will not lend, or will lend only on tighter terms, where the unexpired term falls much below 80 years. A buyer who cannot get a standard mortgage is a smaller pool, which feeds back into price.

The second is statutory valuation. Under the Leasehold Reform, Housing and Urban Development Act 1993, Schedule 13, paragraph 4(2A), "Where at the relevant date the unexpired term of the tenant's existing lease exceeds eighty years, the marriage value shall be taken to be nil." The threshold is strictly less than 80 years unexpired at the valuation date. One day over and marriage value is nil; one day under and it is part of the premium. That cliff is why sellers who are close to it often extend before marketing, and why buyers who are close to it try to serve notice before completion.

The statutory right to a new lease

Chapter II of Part I of the 1993 Act gives a "qualifying tenant of a flat" under section 39(1) "the right…to acquire a new lease of the flat on payment of a premium". Section 56(1) sets the terms of that new lease: it runs for "90 years after the term date of the existing lease" and is granted "at a peppercorn rent". In other words, 90 years are added to the remaining term and any ground rent is extinguished.

A qualifying tenant is a tenant under a long lease — broadly, a lease originally granted for more than 21 years. Historically the right could only be exercised after two years of ownership, but section 27 of the Leasehold and Freehold Reform Act 2024, "Removal of qualifying period before enfranchisement and extension claims", is in force: "S. 27 in force at 31.1.2025 by S.I. 2025/57". A qualifying tenant can now claim a new lease without first waiting two years.

The claim is made by serving a notice under section 42 on the landlord (and any third party to the lease). The notice must identify the flat and lease, propose a premium and lease terms, and set a counter-notice deadline "not less than two months after the date of the giving of the notice". If terms are not agreed, either side can apply to the First-tier Tribunal.

The 2024 Act is the trap

Headlines promise a longer extension, no marriage value and an easier process. Most of that is announced, not law. Under section 124(3) of the 2024 Act, those provisions "come into force on such day or days as the Secretary of State may by regulations appoint". On the legislation.gov.uk pages for each section, as at October 2026:

• Section 27 — removal of the two-year qualifying period — is in force (SI 2025/57, 31 January 2025).
• Section 33, "Longer lease extensions" (the 990-year replacement for the 90-year addition on flats), carries the annotation "S. 33 not in force at Royal Assent, see s. 124(3)". Not in force.
• Section 37, the new method for calculating the premium payable (including the proposed abolition of marriage value), carries the annotation "S. 37 not in force at Royal Assent, see s. 124(3)". Not in force.
• Sections 53 to 58, service charge transparency, each carry "not in force at Royal Assent, see s. 124(3)". Not in force.

In practice: a statutory lease extension granted today still adds 90 years, not 990; marriage value still applies below 80 years; the current valuation rules under Schedule 13 are what you are paying under. Pricing a purchase on reforms that have not commenced is a bet, not a plan.

How the premium is made up

Under Schedule 13, paragraph 2, the premium is "the aggregate of—(a) the diminution in value of the landlord's interest…, (b) the landlord's share of the marriage value…, and (c) any amount of compensation payable to the landlord". Paragraph 4(1) fixes the landlord's share of marriage value at "50 per cent." On top of the premium, section 60 makes you liable for the landlord's reasonable costs of the claim — valuation and legal — and you will pay your own solicitor and your own RICS valuer.

The figures turn on the lease, the ground rent, the flat value and the valuation date, and a RICS valuer uses the statutory method to produce a range. We do not quote premiums in a journal article; anyone who does, without seeing the lease, is guessing.

Informal versus statutory

The informal route is a private deal with the landlord: you ask, they offer, you negotiate. It can be quicker and cheaper, and the parties can agree whatever they like — a different term, a different premium, sometimes a continuing ground rent on the new lease. That last point is the catch. A new lease on the statutory route must be at a peppercorn under section 56(1); on the informal route it need not be, and a continuing ground rent affects both future lender appetite and future resale. Read any informal offer against a solicitor and a RICS valuer, not against the landlord's draft heads of terms.

The statutory route locks the terms by law. It is slower and more procedural, but the result is a 90-year addition, a peppercorn rent, and a tribunal to resolve disputes.

Buying the freehold, and running the block

Chapter I of Part I of the 1993 Act gives qualifying leaseholders a right of collective enfranchisement — buying the freehold of the block. The building must contain "two or more flats held by qualifying tenants", and the flats held by qualifying tenants must be "not less than two-thirds of the total number of flats" (section 3). The initial notice under section 13 must be given by qualifying tenants of "not less than one-half of the total number of flats". It is a group project with its own premium and costs.

Chapter 1 of Part 2 of the Commonhold and Leasehold Reform Act 2002 gives a separate, no-fault route: the Right to Manage. An RTM company — a private company limited by guarantee — takes over the landlord's management functions for the building. No wrongdoing need be shown. The threshold is broadly similar: at least half the qualifying tenants (long leases over 21 years) must be members. Freehold ownership does not change; day-to-day management does.

What to actually do before you offer

1. Ask the seller, in writing, for the unexpired term at today's date, not at grant.
2. Ask whether any section 42 notice has already been served, and whether the benefit of that notice can be assigned to you on completion — that can preserve the valuation date and avoid starting again.
3. Ask for three years of service charge accounts and the reserve fund position. See our note on service charges and ground rent.
4. Commission a RICS valuation of the likely premium, informal and statutory, before you commit on price.
5. Factor in your own solicitor and valuer fees and the landlord's reasonable costs under section 60.
6. If you are buying to let, cross-check against our buy-to-let checks.

A short lease is not a reason to walk away. It is a reason to price the extension in, not around.

General information current at October 2026, and not legal, tax or investment advice. Lease extension and enfranchisement outcomes turn on the wording of the particular lease and current valuation evidence — take advice from a solicitor and a RICS valuer.

Looking at a flat in Manchester and unsure how the term affects your offer? Call Atlas Estates on 0161 710 4510 or visit 12–14 Midland Street, Manchester M12 6LB. Selling a leasehold flat? Start with a valuation. See also our calculators, our guide to sale timescales and our fees.