Gap between flat and house prices reaches highest on record
Key Points
- The gap between the price of a flat and a house in the UK has reached its widest level in 30 years.
- The average price of a house is now 1.9 times more than a typical flat, and 2.3 times more outside of London.
- This ratio has soared in recent years, but not in Scotland, where there is no long leasehold system.
- The government plans to introduce legislation banning new leaseholds in England, which may lead to flats becoming more popular.
The gap between the price of a flat and house in the UK has reached its widest level in 30 years, according to data from online property platform Zoopla.
The average price of a house in the UK is 1.7 times the average price of a flat, which is the widest gap Zoopla has recorded since records began 30 years ago.
Since 2016, the average price of house in the UK has increased by 43% to it’s current figure of £327,000.
The average price of UK flats has seen much slower growth, increasing by 10% over the same period. A typical flat in the UK now costs £193,000.
The price gap between houses and flats is even wider outside of London, where demand for flats is much lower and houses are more affordable.
In London, the house-to-flat price ratio sits at 1.9 times. In the rest of the UK, a typical house costs 2.3 times more than a flat.
Leaseholds play a major role in making flats less attractive to buyers who can afford to buy a house. Four out of five flats listed for sale in England are leasehold properties, which incur an average additional yearly cost of £2,100 in ground rent and service charges.
Importantly, the government has introduced reforms to leaseholds which will cap existing ground rents and ban the sale of new leasehold flats. This bill is expected to be introduced to Parliament this year, with Royal Assent targeted for 2027.
“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,” said Zoopla executive director Richard Donnell.
“Buying a leasehold flat is more complex than buying a house – lease length, service charges and ground rent terms all matter and vary significantly from one property to the next.”
Average flat and house prices
Below are the average flat and house prices by region in the United Kingdom.
Note that unlike England, Scotland does not have a long leasehold system, which has led to the ratio remaining relatively constant for the last decade.
| Region | Average Flat Price | Average House Price | Ratio |
|---|---|---|---|
| South of England | |||
| London | £416,000 | £809,000 | 1.9× |
| South East | £207,000 | £480,000 | 2.3× |
| Eastern | £186,000 | £396,000 | 2.1× |
| South West | £174,000 | £368,000 | 2.1× |
| Midlands, North & Wales | |||
| West Midlands | £120,000 | £296,000 | 2.5× |
| East Midlands | £113,000 | £264,000 | 2.3× |
| North West | £120,000 | £273,000 | 2.3× |
| Yorkshire & Humber | £104,000 | £250,000 | 2.4× |
| North East | £86,000 | £202,000 | 2.3× |
| Wales | £116,000 | £248,000 | 2.1× |
| United Kingdom | £193,000 | £327,000 | 1.7× |
| Scotland | £118,000 | £223,000 | 1.9× |
