Almost nine in 10 leasehold flats listed for sale in England and Wales at the end of last year remained unsold six months later, according to property website Zoopla. The figure stands at 87%, marking the highest rate across five years of comparable data. This contrasts sharply with freehold homes, where 74% of properties remained unsold over the same period.

Leasehold flats have been hit hardest by a broader housing market slowdown driven by rising borrowing costs and economic uncertainty. The London market is especially affected, with leasehold flats comprising over half of properties on the market—triple the national average. Buyers are deterred by high service charges averaging £1,900 annually, or £2,500 in London, along with ground rents ranging from £150 to £250.

Richard Donnell, executive director at Zoopla, noted that pricing has yet to fully adjust to market conditions, though it is gradually moving toward equilibrium. Landlords exiting the rental market are exacerbating the issue by listing flats above market value, with unsold former rentals in London priced 13% higher than average. Despite recent government reforms aimed at modernizing the leasehold system—including capping ground rents and banning leasehold for new builds—many current leaseholders remain trapped by rising costs and complex regulations.

The Ministry of Housing emphasized its commitment to reforming the system to make it fairer and more transparent.