Buyers still pay a pandemic premium for houses over flats, Bank of England research finds
Why it matters for lending
The Bank’s interest is in what headline price moves mean for affordability, mortgage collateral and financial stability. A fall driven by the mix of homes sold carries different risks from a fall in the value of the homes themselves.
For brokers, the gap between houses and flats is already showing up in cases. Weak flat values have made valuations and remortgages harder for some owners who bought after the pandemic, as our report on found. The Bank research suggests the gap is not a passing effect of the pandemic.
Resale figures point the same way. Across Great Britain, 26.7% of flats owned for five to ten years sold for less than their previous recorded price in the year to August 2026, against 2.2% of houses, according to e.surv analysis reported by Landlord Knowledge. London had the highest share, at 39.5%. Flats also made up about 90% of loss-making sales in the capital in 2025 while accounting for 60% of its transactions, Hamptons found, as our report on showed. That leaves landlords with flat-heavy portfolios, and first-time buyers who bought small flats, with less equity than they may expect when they come to refinance or move.
The September house price index is due on 18 November.
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