This case study is based on a real instruction. Names, addresses and identifying details have been changed, and figures rounded, to protect client confidentiality.
The instruction
We were approached by the owner of a two-bedroom purpose-built flat in Wimbledon, SW19, who had received an informal quotation from her freeholder’s managing agent and wanted an independent view before committing. Her lease had 68 years unexpired, with a ground rent of £150 per annum rising by £150 every 25 years.
She had two immediate concerns. Her mortgage was due for renewal in eighteen months and her broker had warned that lenders were becoming cautious below 70 years. She had also been told, incorrectly, that she should “wait for the leasehold reforms” before doing anything.
The problem with waiting
The Leasehold and Freehold Reform Act 2024 abolishes marriage value on the statute book, but that provision is not yet in force. Commencement depends on secondary legislation prescribing new deferment and capitalisation rates, and on the outcome of the freeholders’ ongoing legal challenge. Until then, lease extensions continue to be valued under the Leasehold Reform, Housing and Urban Development Act 1993 exactly as they always have been.
Meanwhile the lease was depreciating every month. Below 80 years unexpired, marriage value becomes payable and the premium accelerates. Our advice was that the cost of waiting an uncertain number of years was likely to exceed any theoretical saving, and that mortgageability was the more immediate risk.
Our valuation approach
We inspected the flat, measured it, and researched comparable evidence across the immediate SW19 catchment — both long-leasehold sales to establish the unencumbered value, and short-lease sales to sense-check relativity. The premium was then built up under Schedule 13 of the 1993 Act:
| Element | Basis | Figure |
|---|---|---|
| Long lease (unencumbered) value | Comparable evidence, SW19 | £525,000 |
| Existing lease value | 92% relativity at 68 years | £483,000 |
| Term — capitalised ground rent | 68 years @ 7% | £2,100 |
| Reversion | Deferred 68 years @ 5% | £19,000 |
| Marriage value (leaseholder’s 50% share) | Schedule 13, para 4 | £10,575 |
| Assessed premium | £31,675 |
The 5% deferment rate follows Sportelli, which remains the starting point for London flats. The capitalisation rate of 7% reflected the modest, fixed-uplift ground rent — a rent with a 25-year review pattern and no doubling is a less attractive investment than a modern escalating rent, and should be capitalised at a higher rate.
The negotiation
The freeholder’s surveyor opened at £46,500. The gap came from three places: a relativity figure drawn from a graph we considered inappropriate for an unenfranchiseable comparison, an unencumbered value of £560,000 supported by two asking prices rather than completed sales, and a capitalisation rate of 5.5%.
We served the Section 42 notice at a properly considered opening figure, then negotiated on evidence. The asking-price comparables fell away once we produced Land Registry completions for the same block. The capitalisation rate moved once we set out the rent’s actual investment characteristics.
The outcome
Settled at £33,250 — a saving of £13,250 against the freeholder’s opening position, and £11,000 below the informal quotation the managing agent had originally offered. The new lease adds 90 years to the existing term at a peppercorn ground rent, which resolved the mortgage question entirely. Total elapsed time from instruction to completion was just under five months.
What this case illustrates
- Opening claims are not valuations. A freeholder’s first figure is a negotiating position and should be treated as one.
- Relativity is where the money is. On a sub-80-year lease, a few percentage points of relativity moves the premium by thousands, because it feeds directly into marriage value.
- Asking prices are not evidence. Completed transactions carry weight at tribunal; asking prices do not.
- Don’t let the lease slide. Every month below 80 years costs money, and mortgageability problems arrive earlier than most owners expect.
Frequently asked questions
How much does a lease extension cost in Wimbledon?
The premium depends on the flat’s value, the unexpired term, the ground rent and the applicable valuation rates — not on a fixed scale. On this SW19 flat with 68 years unexpired and a £525,000 long-lease value, the settled premium was £33,250. A flat of similar value with 95 years unexpired would typically cost a small fraction of that, because no marriage value is payable above 80 years.
Has marriage value been abolished?
Not in practice. The Leasehold and Freehold Reform Act 2024 provides for its abolition, but that provision has not been commenced. Marriage value remains payable on leases below 80 years unexpired at the date of the claim.
Do I need a surveyor as well as a solicitor?
Yes, for anything other than a very long lease. The solicitor handles the notices, the statutory timetable and the new lease itself. The premium is a valuation question, and it is where the money is decided.
What is the 80-year rule?
Once a lease falls below 80 years unexpired, the leaseholder must pay the freeholder 50% of the marriage value — the additional value created by merging the two interests. This can add many thousands of pounds and is the single most important reason not to delay.
Talk to us about your lease
Blakes Chartered Surveyors are RICS Registered Valuers (RICS regulated firm no. 752265) acting for leaseholders and freeholders across London and the South East, with particular depth in Merton, Wandsworth, Kingston and Richmond. Most valuations are delivered within 5–10 days of inspection, on a fixed fee agreed before we start.
Call 020 7373 7373 or email info@blakessurveyors.com for a no-obligation discussion.
