From here one may observe second-rate flat (5)
I believe the answer is:
blimp
'from here one may observe' is the definition.
Although both the answer and definition are singular nouns, I don't see how one could define the other.
'second-rate flat' is the wordplay.
'second' becomes 'b' (B can mean second eg B-side).
'rate flat' becomes 'limp' (I can't justify this - if you can you should give a lot more credence to this answer).
'b'+'limp'='BLIMP'
Can you help me to learn more?
(Other definitions for blimp that I've seen before include "aircraft" , "needs cover when shooting" , "Small nonrigid airship" , "Barrage balloon; backwoods Colonel" , "Elderly pompous reactionary person" .)