An analysis of HM Land Registry data has revealed the “stark divide” between the value of leasehold flats and freehold houses, with flat values depreciating while freehold houses have experienced steady price rises.
Figures sourced from HMLR and analysed by SAM Conveyancing reveal that flats and maisonettes are the only property type in the UK experiencing negative growth, falling by 2.27% year-on-year to an average of £216,246 in June 2026. Over a five year period, flat values deprecated by 1.56%.
At the same time, the value of freehold houses has increased by 3.16% year-on-year, to an average of £285,618. Terraced houses are up 2.76% to £240,147, while detached homes have risen 1.98% to £463,547.
According to Andrew Boast, CEO of SAM Conveyancing, the depreciation of flats is a direct consequence of mounting legal, legislative, and financial pressures on leaseholders. He explained: “The fall in value across the leasehold sector is mirrored exactly by the rise in headaches for owners and prospective buyers.
“We are seeing transactions stall on a daily basis because of delayed leasehold reforms and the sheer complexity of Building Safety Act compliance, ground rent clauses, lease terms and mortgagee protection clauses. Buyers are no longer just looking at the asking price, they are actively factoring in the legal risks and future liabilities.”
The tightening of lending criteria has severely impacted the flat market and made conveyancing “more complex than ever”, Boast added.
“Lenders are heavily scrutinising ground rent terms and insisting on strict mortgagee protection clauses. When you combine this with aggressive freeholder controls, escalating service charges, and unresolved cladding liabilities, many flats are becoming borderline unmortgageable without significant legal remediation.
“It is no surprise that buyers are pivoting toward the security and autonomy of a freehold house.”
With the majority of leasehold flats on the market for over six months, SAM Conveyancing suggests there is “an unprecedented opportunity” for cash buyers and investors to negotiate discounts on urban apartments.
