The house-flat price gap is at its widest in years — here's what that means if you own a flat and want to release equity

How far has the gap widened?

Data from Halifax and Nationwide consistently shows that over the past three years, UK house prices — particularly for detached and semi-detached properties — have grown significantly faster than flat prices. Nationwide data published in June 2026 shows that the average UK house price has risen to around £273,000, but this aggregate masks a stark divergence: detached home prices in many regions have grown 15–20% since 2022, while flat prices in the same areas are up just 3–8% over the same period.

The reasons are multiple. The post-pandemic preference for space and gardens drove a sustained premium on houses. Leasehold reform uncertainty — ongoing since the Leasehold Reform (Ground Rent) Act 2022 and the continuing Leasehold and Freehold Reform Act 2024 — has dampened buyer appetite for leasehold flats, particularly where ground rents, service charges, or building safety remediation issues are unresolved. The cladding scandal has disproportionately affected flatted developments built between 1990 and 2015.

For flat owners aged 55+, this has a direct financial consequence: the equity available to release from a flat may be substantially less than the headlines about rising UK house prices suggest.

How property type affects equity release viability

Equity release lenders — including the major Equity Release Council members — set maximum loan-to-value (LTV) ratios that vary by property type, age of borrower, and lender criteria. For flats specifically, lenders typically apply additional scrutiny in the following areas:

• Leasehold term remaining. Most lenders require a minimum remaining lease term — often 75–80 years after the loan is expected to be repaid. A flat with a short lease may not be eligible for equity release, or may attract a significantly reduced maximum LTV until the lease is extended.
• Building safety certificates. Following the Building Safety Act 2022, lenders require evidence that EWS1 (External Wall System) assessments are in place for high-rise buildings, and that any remediation work has been completed or is fully funded. Flats with unresolved building safety issues may be declined or subject to retention.
• Service charge levels. High or unpredictable service charges are a factor lenders consider, since they represent a continuing liability that can affect the overall affordability and viability of the equity release arrangement.
• Property value versus loan size. Since the minimum loan amount for most lifetime mortgages starts at around £10,000–£20,000, and lenders typically cap LTV at 30–50% for older borrowers depending on age, a flat with a modest market value may not generate sufficient equity to make equity release worth pursuing.

None of this means equity release is impossible for flat owners — but it does mean the process requires careful assessment, and the outcome may differ significantly from what a homeowner with a detached property might expect.

What flat owners should do before approaching lenders

If you own a flat and are considering equity release, a Verity Home adviser can carry out an initial assessment of viability before any formal application is made. The key steps are:

• Obtain an up-to-date valuation of the property. This should be a professional valuation, not a portal estimate — flat prices vary considerably within a building and are sensitive to floor level, aspect, and building condition.
• Check the remaining lease term. If this is below 90 years, lease extension should be explored as a priority — it will both increase the property's market value and expand the pool of eligible lenders. The leasehold reform legislation has changed the costs and process; a specialist solicitor should be consulted.
• Confirm EWS1 or equivalent building safety status with the managing agent or freeholder. If this is unresolved, remediation funding through the Building Safety Fund should be explored.
• Obtain a service charge statement for the last three years, including any major works contributions.

With this information in hand, a Verity Home adviser can give a realistic assessment of which lenders are likely to consider the property and what loan amounts could be available.

For house owners: more equity, more options

For homeowners aged 55+ who own houses — particularly detached or semi-detached properties in regions with strong price growth — the widening gap means that available equity may have grown substantially since the last time they considered the question. With average detached house values in many parts of the South East, Midlands, and South West now exceeding £400,000–£500,000, the amounts that could be released through a lifetime mortgage are correspondingly larger.

This does not mean equity release is automatically the right choice. The decision depends on your specific financial circumstances, retirement income needs, IHT position, and family situation. But if your home has grown in value and you have not revisited your options recently, it is worth understanding what is now available to you.

Speak to a Verity Home specialist for a no-obligation conversation about what could be released from your home — whether you own a house or a flat.