Almost four out of ten flats in London were resold at a loss during the 12 months to August 2026, according to repeat-sales analysis from e.surv Chartered Surveyors.
The data reveals London recorded the highest proportion of flats resold at a nominal loss in Britain. Approximately one-third of flats resold after five to ten years in both the South East and East of England also changed hands for less than their previous purchase price.
Regional variations
The proportion of flats selling at a loss was close to one in five across the Midlands and northern England, compared with just over one-quarter across Britain as a whole. Scotland showed a markedly different pattern, with fewer than one in ten Scottish flats held for five to ten years sold below their previous recorded price.
The e.surv House Price Index indicates flats and houses began to diverge around 2017, as concerns over leasehold, building safety, cladding and service charges increasingly influenced the decisions of buyers, sellers and lenders. The gap between flats and houses in Scotland remains far narrower than in London, the South East or East of England.
Market conditions
Rob Owens, Head of Research at e.surv, stated: “The housing market enters the autumn moving slowly rather than decisively in either direction. Annual price growth remains positive, but shorter-term measures have softened and activity continues to face pressure from higher borrowing costs.”
He added that flats remain one of the clearest areas of weakness, noting the repeat-sales analysis shows this is no longer simply a gap between property-type indices but is being crystallised when owners sell. The findings align with broader concerns about housing market momentum amid elevated borrowing costs.
Owens emphasised the importance of understanding factors behind the performance, including building safety, tenure and service charges, to help buyers make informed decisions and give lenders a clearer view of the risks.
Policy developments
Attention now turns to the Autumn Budget, where the government has confirmed the new Your First Home equity-loan scheme will feature. The return of government-backed support for the new-build market could support both demand and housing delivery, though it arrives in a different market environment from the early years of Help to Buy.
The data suggests flat owners, particularly in London and southern England, face significant challenges in achieving capital appreciation compared to house owners, with structural issues around building safety and leasehold continuing to weigh on values.
