There is no right or wrong answer to this question as it is initially circumstance dependent. However, before the lease has less than 80 years remaining is a good time to extend, as it will avoid the need to pay ‘marriage value’ in the calculation of what is payable to the landlord to buy the new lease (which is a substantial part of the premium).
In other cases the lease will be harder to mortgage where it is 75 years or less, as most banks wants to see lease terms of 50 years plus the 25 year mortgage term. This will reduce the number of people that are able to buy the property, and will eventually depress its market value. It will become something that only someone who can buy without a mortgage can purchase.
This being said, there are numerous areas where short leases abound (where the terms were only originally 65 years or similar) and these tend to be higher value properties on the great estates. Such properties have an intrinsic value based on their location and capital. Different considerations will apply to properties outside Prime Central London.
- More information about extending your lease.