Flat vs house: Which one should I choose?
If you’re trying to decide between buying a flat or a house, here are some questions to ask yourself:
What can you afford?
Affordability is usually the biggest deciding factor. Flats tend to be cheaper than houses in the same area, so if you’re on a tight budget and there’s a particular place you’d like to live, you’ll probably find it easier to buy a flat than a house. To see how much you could afford to borrow for a mortgage, use our Mortgage Calculator.
Let’s look at how house prices and flat prices differ across the UK:
Semi-detached properties: £314,955
Terraced properties: £235,946
Flats: £201,356
Semi-detached properties: £668,791
Terraced properties: £594,691
Flats: £344,492
Semi-detached properties: £518,896
Terraced properties: £362,113
Flats: £232,269
Semi-detached properties: £739,086
Terraced properties: £737,616
Flats: £503,190
Can you afford to pay ground rent and service charges?
There’s more to affordability than just the mortgage, though. Flats usually come with ground rent and service charges. Some houses do too, though it’s not as common.
Ground rent
When you buy a flat, you’ll own the flat itself and its contents, but you won’t own the ground that it’s built on. This will belong to the leaseholder and you’ll have to pay them ground rent each year. In the past, ground rent costs varied depending on where you lived and who owned the land, but it tended to be around £300 - £400 a year. However, ground rent was reformed in 2022 which means that any new leases granted on or after 30 June 2022 will be £0.
Service charges
If that’s not frustrating enough, you’ll also have to pay regular service charges to maintain communal areas such as hallways, stairs, and gardens. The service charges might cover the cost of cleaning, repairs, electricity and the wages of any security guards or receptionists. The exact costs can vary from £50 a month in small or old apartment blocks to several hundreds in more modern buildings in popular areas.
Major works
You may be sent an additional bill to cover the cost of major works such as replacing the lift or repairing the roof. These costs will usually be divided between all homeowners in the building, but they can still be expensive.
Over the last few years, some homeowners living in tower blocks have had to pay for dangerous cladding to be replaced on the outside of their building. The government has since introduced legislation to make cladding replacement the responsibility of developers, but some homeowners will still need to contribute towards the updates.
Before you buy a leasehold property, you must sign a lease. This is a legal document outlining the terms and conditions of renting on that land. Your solicitor should go through the lease for you and bring any significant clauses to your attention before you sign it. Some leases state that the ground rent can double every 10 years, for example.
Some house owners have to pay ground rent and service charges too. This is more common with new builds than older homes. New build property developers sometimes sell the land to an external company that will charge you to live on it, while they maintain it.
When older homes are leasehold, they usually have what’s known as ‘peppercorn rent’ and this tends to be as low as £3 a year.
Are you comfortable being in charge of all maintenance and repairs?
If you live in an apartment building, there’ll usually be a maintenance team that takes care of any issues in communal areas.
Sometimes they may be willing to help with issues that occur in your flat itself, even though you own it. This is more common in blocks of flats where one of the residents has been chosen as the property maintenance manager. If the maintenance team is external, you may have to hire someone to fix the problem.
Still, if you have a leak or there’s problems with your electricity, it’s worth calling your maintenance company or on-site repair team before hiring someone to investigate the problem yourself. This could save you a lot of money!
If you’d rather be responsible for all repairs and maintenance, you may be better suited to a house. You don’t even have to be good at DIY or fixing things! You just need to be willing to do the legwork to find the right contractors.
Do you want luxury features?
Something that gives flats an edge over houses is that they sometimes come with luxury benefits such as a rooftop garden, terrace, gym and even a spa. You’ll also typically have brand new white goods included in the purchase, with warranty included.
They can feel more secure too, often having CCTV, coded doorways, gated entrances and even security guards you can call if you see something suspicious in the car park at night.
Some apartment buildings can offer a sense of community too. You might befriend your neighbours in the gym or shared garden. There might even be a residents’ WhatsApp group where you can find people to accept a parcel for you, recommend a plumber or dogsit when you go on holiday.
