Unsurprisingly, flat prices are significantly higher in London than elsewhere in the UK. Flats in the capital currently sell at an average price of £311,281, 56% above the national average. Significantly, the average price of a flat in London is substantially above the 3% stamp duty threshold of £250,000, presenting the average flat buyer with a stamp duty bill in excess of £9,000. The average flat price in the capital is also in excess of the inheritance tax threshold of £300,000, making flat owners potentially liable to the tax solely on the basis of the value of their property.

At the other end of the spectrum, flat prices are lowest in Yorkshire and the Humber where the average flat sells for £111,448. This is below the 1% stamp duty threshold of £125,000. As a result, the average buyer of a flat in the region pays no stamp duty. The differences between London and Yorkshire underline the significant variations that exist around the country both in terms of purchase price and the additional costs of buying your own flat.

During the past year, flat prices nationally have risen by 16%. Northern Ireland has seen the sharpest increase in flats during the past 12 months with a 26% increase. By contrast, there has been a modest 2% fall in the average selling price of flats in Yorkshire and the Humber. This small decline, however, needs to be seen in the context of the substantial increases recorded over the past few years. Yorkshire and the Humber have recorded a 94% increase in average flat prices the past five years; the biggest rise in England.

A clear north/south divide has emerged over the past year. All the regions of northern England have seen either very small, or falling, flat prices. Wales and West Midlands have also recorded very modest increases. Northern Ireland, Scotland and the southern regions of England have been notably more buoyant, all recording double-digit percentage growth.

Tenure types

Nearly one in five (17%) of all households live in a flat or maisonette, according to the government’s recently published Housing in England 2005/06 survey. There are, however, significant variations between tenure types. Only 7% of those owning their own home living in a flat while more than one-third (36%) of those in the private rented sector live in a flat.

There are also substantial differences between tenure types in terms of living in purpose-built compared to converted flats. The overwhelming majority of those living in their own flat do so in a purpose-built property. By contrast, nearly three in 10 of those in privately rented flats live in a converted property.