Mortgage advisers warn first-time buyers in London about lease length, lender rejections, and the hidden costs of flat ownership
Buying a flat in London as a first-time buyer carries complications that go well beyond saving a deposit – and mortgage advisers say too many buyers are entering the market without understanding the risks involved.
London flat and maisonette prices fell by 7% between February 2022 and February 2026, from £455,139 to £420,635, according to MoneyWeek. Yet that headline decline masks a more complex picture.
For brokers working with first-time buyers in the capital, the conversation often shifts quickly from how much someone can borrow to whether a specific property is worth buying at all, particularly where fire safety, lease length, and escalating service charges are in play.
Lease length: a ticking clock
Nouran Moustafa, executive financial and mortgage adviser at Roxton Wealth in London, told Mortgage Introducer lease length is one of the first things buyers must examine, and one of the most commonly overlooked.
"If someone now is a first-time buyer, 30 years old, and they buy a flat that has 100 years on the lease, by the time they die and this flat gets passed over to the second generation, the flat will be worthless in 20 or 30 years," she said. "If you're taking the stress of a mortgage, if you're putting down a deposit, you need to make sure that there is a decent number of years of lease left on the flat."
Moustafa described a case in which a client wanted to purchase a flat with only 60 years remaining on the lease. She advised against it. "She was 30, so if she were to live until 90, she would pay off the mortgage. But by the age of 90, she would own nothing."
Beyond the personal risk, lenders themselves are reluctant to lend against short-lease properties, which compounds the problem for buyers seeking mainstream mortgage products. The Leasehold and Freehold Reform Act 2024 introduced new rights for leaseholders to extend their leases, but the process remains costly and the underlying structural issue for buyers persists.
When lenders say no
Fire safety and cladding issues, particularly in higher-rise buildings, remain a significant barrier to mortgage lending on certain London flats. The Building Safety Act 2022 imposed new responsibilities on building owners to fund remediation work, but progress across the housing stock has been uneven, and many properties remain caught in a lending grey area.
For buyers who receive a lender rejection, Moustafa said the instinct to push harder for the property is often the wrong one. "When a lender rejects a flat because of a cladding issue or a fire safety issue, you just need to bear in mind you would be living in this place and this place has a potential hazard," she said.
"The mentality should shift from 'I want this and I would do anything to get it' to why did the lender reject the flat, and am I prepared to take this risk?"
Affordability beyond the headline figure
Moustafa also cautioned buyers against conflating what a lender will offer with what they can genuinely afford. "The first thing is you just need to bear in mind how much can you actually afford, not how much the bank is saying you can afford," she said. "You don't need to be working all day every day just to pay off the mortgage."
Louis Mason, director at Oportfolio Mortgages in London, told Mortgage Introducer buyers frequently fixate on the purchase price without accounting for the ongoing costs that can significantly affect long-term affordability.
"For first-time buyers looking at flats in London, the purchase price is only part of the equation," he said. "They need to understand the service charge, ground rent, lease length, and future resale prospects. A lot of first-time buyers don't have a clue about these."
The overall number of new first-time buyer mortgages in the UK has been falling since its peak in 2021, reaching its lowest level since 2013 at 282,000 in 2023, according to Financial Conduct Authority (FCA) data analysed by the Office for National Statistics (ONS).
In London specifically, several boroughs recorded some of the steepest falls in the rate of first-time buyer mortgage sales over the decade to 2023. Against that backdrop, brokers with experience across London's specialist residential lending market are increasingly vital to helping buyers make informed decisions.
Those navigating the complexities of leasehold property purchases and mortgage lending in the UK will find that specialist advice is not optional. For many in London’s flat market in 2026, it is essential. Advisers familiar with the challenges facing UK mortgage brokers and their clients will recognise that the barriers are structural, not temporary.
For Mason, the danger is straightforward. "A flat that looks like a bargain can become far less attractive if it comes with rapidly increasing running costs."
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