Price gap between flats and houses hits 30 year high as buyers swerve leasehold properties

The gulf between the cost of a flat and a house has reached its highest level for 30 years, with buyer concerns over leasehold properties largely to blame. 

Average prices for houses have increased by 43 per cent since 2016, while flat prices have risen by just 10 per cent over the same period according to property website Zoopla. 

The typical cost of a house is £327,000, while a flat is £193,000. 

This means houses now typically cost 1.7 times more than flats. A decade ago houses generally cost around 1.3 times more than flats. 

The West Midlands is home to the ‘most extreme’ gulf between house and flat prices, Zoopla said. 

In the West Midlands, the average cost of a house is £296,000, 2.5 times the cost of a flat, at £120,000.

The flat-house price gap is widest in the Midlands and northern regions, where houses are affordable enough that many first-time buyers skip flats, Zoopla said.  

In Yorkshire and the Humber, a house typically costs about £250,000, while a flat costs around £104,000, meaning houses are 2.4 times more expensive than flats in this location. 

Across the North East of England a house typically costs around £202,000, with flats coming in at £86,000. This means houses are 2.3 times more expensive than flats in the North East. 

In London the average cost of a house is typically £809,000, while flat prices are hovering around the £416,000 mark, Zoopla said. That gives an average price difference of £393,000 and means houses generally cost 1.9 times more than flats in the capital. Seven in ten buyers in London are on the hunt for a flat, the findings added. 

In Scotland, the leasehold system does not apply. Flat owners buy the ‘heritable title’ to their flat which is more similar to owning the freehold. 

There, the price ratio between houses and flats has barely budged for years. 

Zoopla said this showed how ‘uncertainty around leasehold in England is impacting the pricing of flats versus houses’. 

In London, it typically takes 45 days to sell a flat, against 37 for a house. In Scotland the median time to sell a flat is a mere 15 days, the same as it is for a house. 

Time to buy a bargain flat? Possibly, but be cautious 

The gulf between house and flat prices could provide an opportunity for buyers on the hunt for a bargain. But be cautious before taking the plunge. 

Before snapping up a seemingly cheap flat, consider the lease length, service charge and ground rent terms carefully. 

Zoopla’s analysis showed the average leaseholder pays £200 a year for ground rent and £1,900 a year in service charges.     

Average leasehold running costs range from 0.7 per cent to 1.3 per cent of a property’s value a year. When considering whether to hand out a mortgage, lenders scrutinise properties where costs exceed 1 per cent of the property’s value.

Richard Donnell, executive director at Zoopla, said: ‘The gap between house and flat prices has never been wider, and for buyers who are prepared to do their homework, that presents an opportunity.

‘For many, flats remain the main route into home ownership, particularly in London and the South East where the cost of buying a house is higher.’ 

Zoopla added: ‘Uncertainty around buying flats is clearly impacting the market, but not all flats face the same challenges and the leasehold system is undergoing significant reforms.’ 

Ground rents have been banned on new leases. In January 2026 the Government published a draft Commonhold and Leasehold Reform Bill which will now be subject to parliamentary scrutiny. 

The Bill proposes to cap existing ground rents at £250 a year, ban the sale of new leasehold flats and make commonhold the default tenure for new-build flats. 

The Bill is expected to be introduced to Parliament this autumn, with Royal Assent expected next year.