The residential flat market in England is experiencing substantial difficulties, with multiple homeowners and investors struggling to sell properties even after price reductions and extended listing periods. Data from property website Zoopla in June revealed that house prices across the UK increased 43% since 2016, while flat prices rose only 10% over the same period, highlighting a significant disparity in market performance between the two property types.
Leasehold issues represent a primary concern affecting flat sales. Most flats listed for sale in England are leasehold properties, and ongoing controversies surrounding this ownership model—including elevated service charges, ground rents, cladding problems, and costly lease extensions—have dampened buyer interest. Leasehold reform efforts are underway, though a ban on new leasehold properties is not expected to take effect until after the next election.
Analysis of unsold leasehold flats listed in 2025 showed that the majority remained unsold within six months across most of England. London experienced the worst conditions with approximately 87% of leasehold flats unsold, followed by the south-east at 85% and the east of England at 84%, with a national average of 80.5% remaining unsold. Market dynamics further complicate sales, as first-time buyers—the natural purchasers of flats—often have lower budgets than investor-owned properties command, creating a pricing mismatch that restricts transaction volumes.
Additional barriers include increasingly restrictive mortgage lending practices from banks and surveyors’ tendency to downvalue flats, effectively reducing their borrowing value. Small landlords and owner-occupiers report multiple failed sales, with buyers withdrawing during negotiations and requiring additional price concessions. These developments have left numerous property owners financially trapped, unable to exit investments or relocate without significant losses, while simultaneously facing mounting costs related to property maintenance, licensing requirements, and legal fees associated with failed sales attempts.
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