The $30 million toe in the water

The London flat market is in crisis, with almost half of small flats selling for less than their original price. The collapse in flat prices is having a ripple effect across the country , with one third of one-bed flats outside London selling for a loss.

The toxic reputation of leasehold and spiralling service charge costs are making it difficult for landlords to make a profit, while owner occupiers are struggling to get a mortgage due to rising costs.

Why 4,000 unsold units became the prize

Almost half of small London flats - those classed as either one-beds or studios - are now selling for less than they were bought for , according to analysis of Land Registry by property data firm Bricks&Logic.

These losses are for flats not just bought in the last five years, but 10, 15 or even more than 20 years ago.

An echo of Sydney's 2024 institutional buy-up

The slump in flats is spreading out of London, with one third of one-bed flats outside the capital selliing for a loss, while just over a quarter of two and three-bed flats are being sold at a lower price than they were bought for.

This is a dramatic shift from what was hpapening in the summer of 2022 when the Covid induced property boom reached its peak.

Who is the unnamed buyer?

The collapse in flat prices means many people who bought apartments as a way on to the property ladder now find themselves unable to afford something bigger .

The impact of this is likely to ripple out across the housing market and stretch up the property ladder.

What auditors flagged in the May filing

The toxic reputation of leasehold, together with spiralling service charge costs,means that the numbers no longer work for landlords.

At the same time, owner occupiers are either too scared of rising costs, or the service charges are too high - relative to capital values - to get a mortgage .

England has fallen out of love with the flat, says Ashley Osborne, founder of buy-to-let platform, Lexit.