A majority of flat owners selling their homes in Sheffield, Birmingham, Leicester and Newcastle city centres are now selling at a loss of almost £40,000 on average, according to research shared with This is Money.
Analytics firm PropertyData found that 62 per cent of flat sellers in Sheffield city centre, in the S1 postcode, sold for less than they paid for their homes over the past 12 months. In Birmingham city centre, postcode B1, 61 per cent of flat sellers sold at a loss over the same period.
The research looked at every sale in England and Wales in the 12 months to the end of May 2026 and matched each one against the price the seller had originally paid for the same property within the past 20 years. It found the average flat owner sold for £39,509 less than they had paid, after an average length of ownership of just under nine years.
Why prices are falling
Official Land Registry data shows the average flat sold on the market today is typically valued at less than it was worth four years ago. Average flat prices peaked in August 2022, when the typical property sold for more than £200,000. As of May this year, the average price had fallen back to £192,000. Across the country as a whole, 25 per cent of flat sellers sold at a loss over the past year, but city centres have taken the biggest hit.
Philip Jackson, of Maguire Jackson estate agents in Birmingham, said the chill of London had hit Birmingham and called it the worst sales market he had ever known. He said the market was flooded with apartments to sell, most of them bought over the past 20 years, and that his own analysis found 1,400 flats for sale within a mile of his office. In one building, he said, there are 30 identical one-bedroom flats for sale at once, forcing sellers to undercut each other to stand a chance.
Buying agent Nicholas Finn, of Garrington Property Finders, said the problem is an oversupply of flats rather than a wider housing crisis, pointing to cranes dominating the skyline in cities including Birmingham and Sheffield, as well as smaller towns such as High Wycombe and Maidenhead. New-build flats are often sold at a premium to similar second-hand homes, meaning it typically takes longer for them to increase in value, and anyone selling a new build in its first few years can usually expect a loss.
Jackson also pointed to falling investor interest in Birmingham city centre, where a disproportionate number of homes are owned by investors rather than owner-occupiers. He said investors who bought between 2015 and 2020 are now generally selling for the same price or less than they paid, and that the market was also hit badly by the cladding crisis following the Grenfell Tower fire, with many flats still locked by cladding issues unless owners accept a major price cut.
Leasehold charges add to the burden. Many leasehold flats carry ground rents paid to the freeholder, and while ground rents have been outlawed for new leaseholds, many existing leaseholders still pay them. Service charges, which cover things like insurance, cleaning, repairs and managing agents' fees, rose by an average of 41 per cent between 2019 and 2024, according to The Property Institute, which put the average leaseholder's annual bill at £3,634.
Losses in the North East
Areas in the North East, including Sunderland's SR2 postcode, Darlington's DL3 postcode and Newcastle city centre's NE1 postcode, are among the top ten areas for the highest proportion of flat losses. Richard Donnell, of property website Zoopla, attributed this to lower property prices in these areas and heavy exposure to city-centre new-build flat schemes from the 2000s and 2010s that were aimed at buy-to-let investors. He said many of these flats were bought at high initial prices on low mortgage rates, and owners now face a smaller pool of buyers. A lack of house-price growth in these areas means some flats are worth less than they were 15 to 20 years ago.
Losses in the South and London
Severe flat losses are not limited to the North. Affluent southern commuter-belt areas including Runnymede, Mole Valley, Hart, Woking, Uxbridge, Windsor and Maidenhead, and Winchester, as well as the London borough of Kensington and Chelsea, have all seen large proportions of flat owners sell at a loss.
In Uxbridge's UB10 postcode in west London, which includes parts of Hillingdon and Ickenham, 58 per cent of flat owners have sold for less than they bought their homes over the past year. In Winchester's SO22 postcode, 55 per cent sold at a loss. Donnell said many of these flats were bought during the low mortgage-rate window of 2016 to 2021, and flats bought in London and the South East between 2016 and 2022 are more likely to sell at a loss today. He said these buyers are being hit by the mortgage rate shock on larger mortgages since 2022, and that prime London has faced weak overseas demand and a stamp duty drag on what buyers are willing to pay.
Is now a good time to buy?
Many flats on the market are not selling at all, and it is sellers prepared to take a hit on price who are finding buyers, giving buyers an opportunity to secure discounted flats. Jackson said savvy investors smell blood in the water, with auction companies doing very well as predator investors and the odd owner-occupier working in the city centre drive a hard bargain. Finn said that if he were an investor looking right now, he would only buy aggressively.
Not every area is losing
The picture is not universal. In Chorlton, in Greater Manchester's M21 postcode, not a single flat seller sold at a loss over the past year. In Eccles in Salford, postcode M30, only 6 per cent of sellers made a loss, while 13 of 215 flat sellers in Didsbury and Withington, M20, did. In Brockley, in south-east London, only six of 118 flat sellers took a loss.
How sellers can cut their losses
In areas where the number of flats for sale outstrips buyers, sellers need to stand out on appearance or price. That means decluttering, cleaning windows, painting the front door and walls where needed, keeping decor neutral and fixing anything that might put buyers off. New kitchen cabinets, worktops or a renovated bathroom, or even new carpet or flooring, can make the difference between selling and not selling.
Experts warn against listing at an ambitious asking price with a view to reducing it later, since the longer a property sits on the market, the less interest it tends to attract, with buyers treating repeated price cuts as a warning sign. Pricing below similar flats on the market is more likely to attract competing offers and a bidding war that pushes the final price higher. According to property website Rightmove, properties that have been discounted are twice as likely to see sales fall through, take much longer to sell and are more likely never to sell at all.
