Propertymark’s recent survey highlights a stark warning for the UK property market. With 93% of leaseholders stating they would avoid purchasing another leasehold property, the current system is clearly deterring a significant segment of buyers. For investors, this signals a potential reduction in demand for leasehold flats, which could depress prices or slow sales in affected areas.
Rising service charges are a major factor. Over 86% of respondents reported increases in the last two years, often without transparent justification. This volatility in holding costs adds an unpredictable layer of risk for investors relying on steady rental income or resale prospects. The fact that 89% find it difficult to challenge unfair charges further entrenches this issue, potentially leading to longer-term disputes and administrative burdens.
For those holding leasehold assets, the call from Propertymark to accelerate government reform is a clear indicator that the status quo is unsustainable. Investors should monitor any legislative changes closely, as reforms could alter lease terms, ground rents, and service charge frameworks—directly impacting asset valuations and management costs.
In summary, leasehold properties currently carry a reputational and financial risk that investors must factor into acquisition and portfolio decisions. Until reforms provide more clarity and fairness, leasehold investments will likely remain less attractive compared to freehold or new-build options with clearer ownership structures.
Source: Property118
