Typical service charges for flats increased by 11% in 2024 to £2,300, or £192 per month, research from Hamptons estate agents shows.
This means over half (51%) of leaseholders are paying more in service charges than council tax.
David Fell, lead analyst at Hamptons, said: “While the cost of running a home has risen for pretty much every household over the last five years, some leaseholders have seen costs rise much more quickly. And with limited ways to find savings, the cost of running some facilities, which were affordable five or 10 years ago, could now be breaking the bank.
“Both buyers and mortgage lenders have become increasingly cautious about committing to high service charge costs, particularly where they perceive charges to be disproportionate to the amenities they get in return. Consequently, there is mounting pressure for leaseholders to have a greater say in how their money is spent.
“Would-be sellers paying high charges have often seen the value of their homes rise more slowly or even fall. In some cases, sellers are offering potential buyers a cash contribution towards future service charge payments.”
The higher number of large city centre schemes which offer a lift, gym and concierge facilities across the Midlands and North of England has created a growing North-South divide, Hamptons said.
This has driven up service charges faster in the North of England than in the South.
The North East has seen average service charges rise 60.9% over the last five years (2019 to 2024), a larger increase than anywhere else in the country.
The North West followed with a 57.6% increase, and Yorkshire & Humber with a 40.2% increase.
Meanwhile, the four regions of Southern England (London, South East, South West and East) have seen average service charges rise by 27.7% over the same period.
