UK Property Sales Fall as Flats Struggle to Sell
Opinion
By Ivo de Noronha
The UK housing market weakened further in 2026, with agreed property sales down 7.3% year-on-year to week 36. Net sales also declined, while the fall-through rate reached 25.1%, slightly above its ten-year average. The wider market is being affected by higher borrowing costs and weaker affordability resulting in a growing gap between seller expectations and what buyers are willing or able to pay. UK house prices also fell 0.4% annually in August 2026, marking the first annual decline in almost three years.
For owners of leasehold flats, however, the position appears more difficult still. Zoopla data indicates that around 80.5% of flats listed for sale in 2025 had failed to find a buyer within six months. In London, the figure was approximately 87%, followed by the South East at 85% and the East of England at 84%. The longer-term performance gap is also significant, with average UK house prices rising by around 43% since 2016 while flats have increased by only about 10%.
This divergence is not simply about buyer preference. Purchasers of leasehold flats must assess not only the purchase price and mortgage repayment, but also service charges, ground rent, major works, building insurance, lease terms and, in some cases, building-safety issues. These additional liabilities can materially affect affordability and mortgageability. A flat may therefore appear competitively priced but become less attractive once the buyer understands the continuing annual costs or the possibility of substantial future expenditure.
Leasehold flats are proving harder to sell as buyers become more cautious and ownership costs come under closer scrutiny.
Leaseholders are also unusually dependent on the management and financial condition of the wider building. Poor reserve planning, rapidly increasing service charges, expensive insurance, unresolved fire-safety issues, major works or delays in providing management information can all affect a sale, even where the individual flat itself is in excellent condition. A willing buyer may still withdraw, or a lender may raise concerns, if the building presents uncertainties that cannot be resolved quickly.
This is why the current problem is about more than falling prices. For many leaseholders, the increasingly important question is not simply “What is my flat worth?” but “Can I actually sell it?” In a softer market, buyers have more choice and are less willing to accept uncertainty. The financial, regulatory and management quality of the building therefore increasingly forms part of the value and saleability of every flat within it. Good building governance is no longer merely a management issue; it is becoming an important component of residential property value.
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