Property prices in Manchester city centre have plunged by £74,000 in just two years, and owners of leasehold apartments say they are trapped in a 's***storm' of sky-high service fees and unresolved cladding issues.
Residents spoken to by the Manchester Evening News say the situation has rendered many flats unsellable, with some estate agents even refusing to list certain properties in blocks plagued by maintenance issues.
Today, those who saw the rapid growth of Manchester's skyline as an opportunity have now slammed the leasehold ownership model as 'financial suicide'. Other residents claim they have been left in tens of thousands of pounds worth of debt from unaffordable service charge fees while trapped in flats they say are unable to sell.
Leasehold flat prices in Manchester city centre
Since 2024, average leasehold flat prices in Manchester city centre have been declining. The property prices had been gradually increasing year on year, but in 2025 then dropped by 10 per cent, and so far this year have dropped by 17 per cent. Across Greater Manchester, they are the only property type reducing in value, at a rate of -1.5 per cent each year, according to the Office of National Statistics.
New figures analysed by the Manchester Evening News have revealed the decline in leasehold flat prices. Currently, the average leasehold flat sold within city centre postcodes is almost £74,000 cheaper than it was just two years ago, meaning flat costs are now similar to what they were in 2019 – some seven years ago.
Now, the average cost of a flat in the central Manchester area is £222,097. In 2024, this figure was almost £300,000. At the time of writing, Rightmove had more than 2,600 flats listed for sale within Manchester city centre.
'It's financial suicide'
David Baddeley, who owns a flat in Beetham Tower, described leasehold ownership as 'financial suicide'. Having bought his property in 2013 for £250,000, it was actually valued at £0 by one agent earlier this year, with other local estate agents also refusing to list it due to well-documented defects with the glass façade on the building.
He says he was told he could list his property to cash buyers for around £200k, some £50,000 less than he bought it for 13 years ago, and instead chose to rent it out privately. He told the M.E.N. he remains in tens of thousands of pounds worth of debt due to service charge fee increases, and is facing bankruptcy later this year.
In 2019, his yearly service charge costs amounted to £393 a month. As of 2024, they had risen to £587, leaving him with no option but to move out and try to cluster up funds through renting.
Speaking about being a leaseholder, business-owner David said: "It's financial suicide going into leasehold property at this moment in time. You're basically signing up for a deal where your costs could increase and there's nothing you can really do. It's a gamble. If someone buys a flat and suddenly finds themselves in a situation like we did with service charge fees and building problems, you can quickly be in complete financial distress with no way out."
He added: "For me it's just been an absolute s*** storm. I was told by a legal expert that if the service charges equate to over two per cent of the property value, it's just not sustainable."
'I pay more than £3,000 a year and don't know what for'
Josh Khanzadeh bought his St George's Island flat in Castlefield two years ago. Costing him just over £180,000, the apartment was sold to him at auction for less than what the previous owner had bought it for 17 years earlier – due to the owner's desperation to sell and well-reported cladding issues on the property.
Following the Grenfell Tower disaster in 2017, after which thousands of blocks were inspected, over 4,000 in England were identified as having unsafe cladding. And although government funding has covered some remediation, many leaseholders have struggled to sell while waiting for work or paperwork to be completed, also further driving down property prices.
Speaking to the Manchester Evening News, Josh, 26, said he 'doesn't know' what his £3,000 per year service charge fees really pay for, adding his block has no co-working space, gym or other shared facilities. "I bought my flat in August 2024 for £182,500, although by the time I'd paid the auction fees, it had actually cost me around £192,500," he said. "It had previously sold for £193,000 back in 2007."
"The main reason I was able to buy it was because of the cladding issues. The previous owner had struggled to sell it for three years because lenders wouldn't touch it, so it ended up going to auction."
"Even after my offer was accepted, the purchase took around eight months to complete. There were multiple delays because it was a leasehold property, including needing a deed of variation, which made what should have been a straightforward purchase much more complicated."
"I actually moved into the building while the external cladding works were still ongoing, and I've recently been told there are now internal remediation works planned, meaning I'll have to move out of my flat for around a month while they're carried out. It's another layer of disruption that comes with buying a property affected by building safety issues."
On service charge fees, Josh said: "They are around £3,300 a year, which feels high considering we don't have many of the facilities that newer apartment blocks offer, like a gym or co-working spaces. I don't know what they pay for. It's always in the back of my mind that they could increase with very little warning."
"Looking ahead, my biggest concern is selling the flat. Given everything that's happened with the building and the wider leasehold market, I'm not expecting to make much, if any, profit. I also expect that selling it will be a long and potentially difficult process, especially if buyers face the same hurdles that I did."
Government reform and response
But the government has announced reform. Earlier this year, they published the draft Commonhold and Leasehold Reform Bill and in the King's Speech in May, it confirmed that it will be brought forward in this session – which it said would 'transform the experience of homeownership' for millions of leaseholders across the country, while modernising property law which will see leasehold on new flats completely banned. It will ban leasehold for new flats and also cap ground rents at £250.
And coming into force from 2027, under the additional Leasehold and Freehold Reform Act, it will call for transparency over service charge payments and what they will cover. Where disputes arise, new rules will then protect leaseholders in challenging them, and from footing their landlord's legal bills without challenge, and enable them to apply to recover their own costs.
A government spokesperson said: "Far too many people have fallen victim to the feudal leasehold system in Manchester and across the country which is why we are taking action to end it for good. Our reforms will ban leasehold for new flats, cap ground rents at £250, and make unreasonable service charges easier to challenge – giving leaseholders the fairness and stability that they deserve."
Meanwhile, Housing Minister, Matthew Pennycook said: "As we bring the feudal leasehold system to an end and move towards a commonhold future, existing leaseholders will not be left behind. We are acting to enable more existing leaseholders to take control of their buildings and more easily convert to commonhold as and when they judge the time is right for them, and we are strengthening protections for existing leaseholders in the here and now by driving up service charge transparency and rebalancing legal costs so that leaseholders are empowered to challenge unreasonable charges."
