The average leaseholder in England and Wales paid £2,405 in service charges in 2025, equivalent to £200.42 per month, according to analysis of flats listed for sale by Hamptons.
It is the first time the average monthly service charge has exceeded £200. By the end of 2025, the average charge was 4.6% higher than a year earlier.
Over the past five years, average service charges have risen by 32.6%, up from £1,814 a year (£151.15 per month) in 2020 to £2,405 in 2025.
These increases have outpaced inflation. Over the last year, service charges rose 4.6%, compared with 3.4% for the Consumer Price Index (CPI), a difference of 1.2 percentage points. Over five years, CPI increased by 30.9%, compared with 32.6% for service charges. Over the decade from 2016 to 2025, service charges rose 55.6%, exceeding CPI growth of 39.8% over the same period.
London continues to record the highest service charges and the fastest growth. The average annual charge in the capital stands at £2,801, or £233.45 per month, up 6.4% year on year. Over five years, charges in London have risen 41.2%, and 64.5% over the past decade. Higher costs in the capital are typically associated with taller developments and additional amenities, which increase running expenses.
Across England and Wales, the average annual service charge for a one-bedroom flat is £2,074 (£172.81 per month), up 3.3% on 2024. For a two-bedroom flat, the average charge is £2,463 (£205.28 per month), a 4.8% annual increase. Three-bedroom flats now carry an average charge of £3,146 (£262.16 per month), up 5.7% year on year and above £3,000 annually for the first time.
In 2025, 37% of flats had a service charge exceeding 1% of their property value, compared with 29% five years earlier. This threshold is significant because some mortgage lenders restrict lending on flats where service charges regularly exceed 1% of the property’s value — for example, a £4,000 annual charge on a £300,000 flat.
A further 14% of flats had service charges above 2% of their value, while 6% exceeded 3%, with higher ratios more common in city centre developments. A higher service charge can limit the number of lenders willing to offer finance, potentially increasing borrowing costs. On average, service charges equated to 0.90% of a flat’s value last year.
The increase in service charges as a share of value reflects both rising service charges and falling sales values. In much of the country, flat prices typically sit below their pre-pandemic 2019 levels, with one in five (19.9%) flat sellers in England & Wales last year achieving less than they originally paid. Meanwhile, service charges have risen consistently over the same period.
While service charges cover apartment blocks with a wide range of amenities, higher charges can hit saleability. Last year, flats marketed with a service charge at or below 1% of their value were 50% more likely to find a buyer than those with charges equating to 2% or more.
The number of flats with low service charges has fallen sharply. Just 14% of flats now come with a service charge of less than £100 per month, a figure which has halved from 34% five years ago (chart 4). Typically, these are found in low-rise blocks with minimal amenities.
While there is a regional element to lower service charges, the cheapest bills are often found in low-rise 1970s and 1980s builds that have stood the test of time. 30% of flats in the North East still have a service charge of under £100 a month, followed by 28% in both the East Midlands and the South West.
David Fell, Lead Analyst at Hamptons, said: “Many leaseholders have seen the economic efficiencies of sharing a single roof with their neighbours steadily eroded by rising running costs. Traditionally, the cost of running a flat has been below what owners of houses spend over the long term. However, in recent years, large increases in management and compliance costs that aren’t paid by homeowners have upset the equilibrium.
“While the government is looking to cap ground rents, it is service charges which are usually the single largest cost for leaseholders by some margin. But the unplanned nature of building maintenance means that they can’t be capped. However, the squeeze on leaseholders’ pockets has been exacerbated by bigger administrative bills, with funds being diverted from direct investment in bricks and mortar.
“The city centre flat boom, which took off in the mid-1990s, means many bigger blocks of flats are now turning 30. This can mean that big-ticket items such as roofs, lifts, and windows are approaching the end of their life. So, where there aren’t sufficient sinking funds in place, it’s inevitable that bigger service charge bills will be landing on the doormats and inboxes of leaseholders.”
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