Eight out of 10 properties in London's most exclusive postcodes now sell below asking price, according to research by Coutts, the private bank. Areas affected include Mayfair, Belgravia and Knightsbridge.
Property prices in prime central London dropped 5% in the third quarter of 2026. Properties sell at an average 10% discount to asking price, Coutts found, meaning some owners face hundreds of thousands or millions of pounds in losses.
Prices in the highest end of London's market are now 14% below their 2014 peak. Knightsbridge and Belgravia have been hit hardest, with prices 30.8% and 26.9% below their peaks respectively, Coutts said.
Coutts attributed the slowdown to Brexit, the Covid pandemic, higher property taxes, higher borrowing costs and reduced interest from foreign buyers following abolition of the non-dom tax regime.
New listings in prime central London dropped 14% compared with the previous quarter. Transactions fell 9.1% in the third quarter, with the biggest decline in the £2m to £5m band, where transactions were down 22.3%, Coutts reported.
Activity differs at the very top end. Savills found 26 transactions above £10m occurred in the third quarter, bringing the annual total to 127. These sales were worth £2.88bn together.
Alex Webster, head of lending at Coutts, said buyers and sellers were taking a more cautious approach. She added that "financing conditions and the wider economic environment will continue to influence the market."