Leasehold flat owners faced average service charges of £2,405 in 2025, according to Hamptons data reported by This is Money Mortgages. This represents a 4.6% increase from 2024 and equates to just over £200 per month. Over the past decade, these costs have risen by more than 55%, outpacing inflation and wage growth, putting additional financial pressure on leaseholders.
The steady climb in service charges highlights a growing affordability challenge for those owning flats on leasehold tenures. Unlike freeholders, leaseholders must budget for ongoing fees covering building maintenance, insurance, and communal services. These costs can vary widely depending on the property’s location, age, and management quality, but the average figure now approaches the equivalent of a small mortgage payment.
For investors, this trend raises questions about the long-term appeal of leasehold flats, especially for buy-to-let landlords who must factor in rising service charges when calculating yields. It also underscores the importance of scrutinising service charge histories and budgets before acquisition. While legislative reforms have sought to improve transparency and control over leasehold costs, the data suggests owners still face significant ongoing expenses.
In sum, the rising service charges add a layer of risk and cost that investors and owner-occupiers alike should consider carefully. Leasehold flats remain a viable investment, but the growing financial burden requires thorough due diligence and contingency planning.
Source: This is Money Mortgages
