Why Leaseholders Are Losing Thousands by Relying on Online Lease-Extension Calculators
With more than half of all UK flats now below 90 years unexpired, lease extensions have become one of the most common valuation instructions we deal with at Olden Property. And while awareness is increasing, so is the use of online lease-extension calculators, tools that often promise a “quick estimate” but routinely mislead leaseholders.
In 2025, this is becoming a real issue. We regularly see clients who have relied on these calculators and entered negotiations massively underprepared. In some cases, they have unknowingly cost themselves tens of thousands of pounds.
Here’s why.
1. Calculators ignore local relativity evidence
Relativity, the percentage relationship between a short lease and its full (long lease) value is central to calculating a premium. But relativity is highly location-specific.
For example:
A 65-year lease in Brighton trades very differently to a 65-year lease in Catford, Guildford, or Tunbridge Wells.
Tribunal decisions vary by region.
New auction evidence can materially shift relativity, even within months.
Online calculators cannot possibly account for this localised evidence. Most use a generic relativity curve that does not reflect real market behaviour.
2. They can’t assess whether the flat has “hope value”
Some leaseholders believe that if the lease is relatively long (e.g., 82–90 years), the premium will be simple and small. But certain flats , especially those in prime blocks, high-value London areas, or buildings with strong long-lease comparables ,may attract hope value even above 80 years.
A calculator won’t flag this. A valuation will.
3. They assume flat, generic ground rents
One of the most inaccurate assumptions we see is the treatment of ground rent. Calculators often assume:
a simple, non-compounded rent
a standard low capitalisation rate
no doubling mechanism
no link to RPI or reviews
Many modern leases have more complex rent structures. If the rent doubles every 25 years, for example, the effect on the premium can be substantial.
4. They cannot consider recent improvements (which must be disregarded)
A professional valuer knows that any improvements made by the leaseholder, new kitchen, new bathroom, layout alteration, rear extension, must be disregarded for statutory valuation purposes.
Online tools often factor them into the open-market long-lease value, artificially inflating or distorting the premium.
5. They give a false sense of certainty
Calculators give results to the nearest pound, which can make them appear precise. In reality, lease-extension premiums typically sit within a range and depend on:
negotiation strategy
the valuer’s assumptions
freeholder expectations
whether the case is statutory or informal
how marriage value is approached
the strength of comparables
Statutory lease extensions require both technical calculation and commercial judgement. A calculator cannot negotiate; a competent valuer can.
Why early, accurate valuation advice matters
A leaseholder who relies on an online estimate may:
serve a notice with an unrealistic premium
trigger an adversarial response from the freeholder
weaken their negotiating position
miss opportunities to resolve the matter informally
end up paying more because the lease dips below the 80-year threshold
We frequently act for clients who initially relied on a calculator and then approach us after negotiations go wrong. By that point, options are usually narrower, and the costs higher.
Olden Property: Specialist Lease-Extension Valuers
At Olden Property, we provide:
Formal RICS-compliant valuations
Pre-notice premium advice
Negotiation with the freeholder or their surveyor
Tribunal preparation (if required)
Advice for buyers at auction considering short-lease opportunities
Support for freeholders responding to Section 42 notices
Our work spans London, Kent, Sussex, Surrey and the wider South East, with detailed knowledge of relativity evidence, tribunal decisions, and short-lease market behaviour across the region.
Thinking of extending your lease?
If you’re considering serving a Section 42 notice, buying a short lease, or simply want to understand the true premium, we’re always happy to help.