Lease Extension Tribunal Cases: The Expert Valuer's Role at the FTT

When a lease extension or freehold claim cannot be agreed, the premium is decided by the First-tier Tribunal (Property Chamber), and the evidence that decides it comes from the parties' expert valuers. A lease extension tribunal valuer is a RICS Registered Valuer instructed to give independent expert evidence on the premium under the Leasehold Reform, Housing and Urban Development Act 1993. Once a case is referred, the valuer's duty runs to the tribunal, not to the party paying the fee. This guide explains the process, the valuer's role at each stage, what the report contains and what it costs.

How a lease extension claim reaches the tribunal

A statutory lease extension begins with a tenant's notice under section 42 of the 1993 Act, which proposes a premium for a 90-year extension at a peppercorn rent. The landlord has two months to serve a counter-notice under section 45, which usually admits the right but proposes a higher figure. The two valuers then negotiate. If no agreement is reached, either party may apply to the tribunal under section 48, no earlier than two months and no later than six months after the counter-notice. Collective enfranchisement claims follow the same shape through sections 13, 21 and 24; house claims run under the Leasehold Reform Act 1967.

In England the forum is the First-tier Tribunal (Property Chamber); in Wales it is the Leasehold Valuation Tribunal. Appeals go to the Upper Tribunal (Lands Chamber) with permission. Our guide to going to tribunal for a lease extension or collective enfranchisement covers the timetable in more detail.

What does the expert valuer do at the FTT?

The tribunal's procedure rules restrict expert evidence to what is reasonably required and place an overriding duty on every expert to help the tribunal, which takes priority over any obligation to the instructing party. The Civil Procedure Rules do not apply in the tribunal, but RICS members are bound by the RICS practice statement Surveyors acting as expert witnesses wherever they give evidence, so the standard expected of a valuation expert witness is the same as in court: independence, a reasoned opinion and a signed declaration.

In practice the expert valuer's work falls into four stages. First, the directions issued by the tribunal set dates for statements of case, exchange of expert reports, an experts' meeting and the hearing bundle. Second, the valuer inspects the flat and building (a desktop valuation is rarely adequate once a case is contested) and gathers comparable evidence. Third, the two valuers meet, without the parties, to narrow the issues and produce a statement of agreed facts and disputed matters, often set out as a Scott schedule showing each valuer's figure for every input. Fourth, the valuer attends the hearing, is cross-examined, and answers the tribunal's own questions. Tribunal panels often include a surveyor member alongside the judge, so the questioning is technically informed.

What the tribunal expert report must contain

A report that simply states a premium carries little weight. The tribunal expects the workings behind every input, so the report normally sets out:

• The valuation date. For a lease extension this is the date of the section 42 notice, not the hearing date, so the valuer must value as at that date and ignore later evidence, in the same way as any retrospective valuation.
• The unexpired term and ground rent, taken from the lease, with any rent review pattern capitalised at a stated rate.
• The reversion, being the freehold vacant possession value deferred for the unexpired term. The generic deferment rates of 5 per cent for houses and 4.75 per cent for flats established in Earl Cadogan v Sportelli are the starting point, and a valuer departing from them must justify why.
• Marriage value, where the unexpired term is below 80 years, shared equally between the parties under Schedule 13. This usually turns on relativity, the value of the existing lease as a percentage of the freehold, and the choice of relativity graph is one of the most contested points at hearings.
• Comparable evidence for the freehold value: sales of flats in the block or street, adjusted for condition, floor level and lease length, with the adjustments explained.
• Compensation for other loss to the landlord, if claimed, and the statement of truth and declaration required of an expert.

Where the valuer also acted in the negotiation, the report should say so and confirm that the opinion given to the tribunal is independent of the figure advanced then.

Where lease extension tribunal cases are won and lost

Most disputes come down to three inputs. The first is the freehold vacant possession value, which drives the reversion and the marriage value. The second is relativity, where a few percentage points on a short lease can move the premium by thousands of pounds. The third is the capitalisation rate for the ground rent, which matters most where rents escalate.

Evidence quality decides these points. A valuer who has inspected, verified comparables against Land Registry entries rather than portal listings, and explained each adjustment will usually be preferred. The experts' joint statement matters too: where the valuers agree the facts and most inputs, the hearing may be dealt with on paper or in a few hours. Our guide to the valuation expert witness role in property disputes explains how the same principles apply in court.

Costs, fees and who pays for the valuer

The tribunal is a no-costs forum. Each side pays its own valuer and legal fees, and costs are awarded against a party only for unreasonable conduct. Section 60 of the 1993 Act makes the tenant liable for the landlord's reasonable valuation and legal costs of dealing with the notice and granting the new lease, but expressly not for the landlord's costs of the tribunal proceedings themselves. A tribunal reference is therefore a commercial decision: the gap between the two figures must justify the fees on both sides. Our guide to who pays expert witness fees covers the wider rules.

As a general picture of the market, a negotiation-stage lease extension valuation starts at a few hundred pounds. A tribunal-compliant expert report for a single flat typically costs from around £1,000 to £2,000, with hearing attendance charged at £1,000 to £2,000 per day; complex or collective claims involving several flats, development value or unusual lease terms fall into the £5,000 to £15,000 range, and hourly rates for a RICS Registered Valuer are typically £150 to £300.

What changes under the Leasehold and Freehold Reform Act 2024?

The Leasehold and Freehold Reform Act 2024 will change the valuation basis, most notably by abolishing marriage value, prescribing the capitalisation and deferment rates, and lengthening the standard extension to 990 years. Some parts of the Act are already in force, including the removal of the two-year ownership requirement before a claim can be made, but at the time of writing the valuation provisions had not been commenced, so claims started now are still valued under the 1993 Act basis described above. Because the premium can differ substantially between the two regimes, the timing of a section 42 notice is itself a valuation question, so check the current position with a solicitor and valuer before serving.

Lease extension tribunal valuers from Survey Merchant

Survey Merchant provides RICS Registered Valuers as lease extension tribunal valuers through its valuation expert witness service, drawn from a national panel of 2,400+ RICS surveyors. The panel's valuers prepare the negotiation-stage lease extension valuation, advise on collective enfranchisement premiums and other leasehold matters, produce tribunal-compliant expert reports, take part in experts' meetings and attend First-tier Tribunal hearings, and act for leaseholders, freeholders and managing agents across England and Wales. The leasehold calculator gives an early indication of the premium. Survey Merchant matches the valuer to the building and the stage the claim has reached, and quotes fixed fees for the report stage. To discuss a claim heading for the tribunal, contact Survey Merchant or call 0204 579 8270.