London’s most expensive homes have lost a fifth of their value in the past 10 years, data shows.
The prices for properties sold at £4.75 million and above has fallen by 2.6 per cent over the past year, according to the estate agency Savills.
The average property price in the capital is 21 per cent cheaper than in June 2014, equating to a drop of £1.2 million.
The area that saw the biggest decline in prices was Marylebone, with a 4.6 per cent drop since last year, followed by Knightsbridge and Earl's Court at 4.3 per cent. With the exception of Notting Hill, where values remained the same, the lowest decrease was in Mayfair at 0.2 per cent, the Savills’ report shows.
The rise in stamp duty and millionaires leaving the capital after the decision to abolish the non-dom tax status from April 6 were contributing factors, according to Lucian Cook, head of residential research at Savills. “The abolition of the non-doms tax regime and imposition of an increased stamp duty surcharge on additional homes sits firmly behind a further easing in prices in central London,” he said.
Prices have declined at a similar level to the 2008 financial crisis, and are expected to drop further throughout the year. "Prices are in a similar position to those last seen in 2009 and 1992, when values had fallen by 25 per cent and 22 per cent, respectively," he said.
“But despite some owners becoming non-resident for tax purposes, we haven’t seen a lot of stock hit the market. Our clients are broadly keen to keep a base in London, especially given the backdrop of global geopolitical uncertainty. As such, our expectation that prices in prime central London will bottom out this year remains," Mr Cook said.
Sales in 2024 dropped by almost half a billion on the preceding year, with £857 million worth of properties sold, according to luxury estate agents Beauchamp Estates. “I haven’t seen a market like this in years. It’s the drop in volume, the number of sales has fallen,” said Paul Finch, a director at Beauchamp Estates.
London lost a net 10,800 millionaires to migration last year, a record number that marks a 157 per increase on 2023, according to Henley & Partners. The UAE was their second top destination after the European Union.
Sanctions imposed on Russian oligarchs after Moscow’s invasion of Ukraine in 2022 were another contributing factor. “There are more reasons for the discretionary wealthy to sit on their hands and wait,” Mr Finch told The National.
Among the super-prime properties that failed to sell was a five-bedroom mansion in Belgravia, formerly the home of the Delevingne sisters, and the casino tycoon John Aspinall.
The property's price dropped from £23.5 million when it was put on the market in early 2024 to £21 million in 2025.
“Despite significant global publicity due to famous past owners the property failed to sell and while we had a few offers, all were below the asking price and not at values acceptable to the vendor,” Mr Finch said, although the new price had generated a “number of fresh viewings”.
Comparing the situation to the financial crash in 2008 – he said a key difference today was the “slow decline” of house prices over a long period. After sales “ground to a halt” in 2008, they were quickly kickstarted by “opportunists” jumping in to buy homes at lower prices.
But sales of luxury homes today have simply “slowed down and petered out”. “There is a lethargy in the market where buyers don’t have to buy and sellers don’t have to sell,” he said.
Another penthouse in Belgravia’s Eaton Place, formerly owned by Christine McVie of Fleetwood Mac, has been priced at £6.95 million, despite valuations going up to £12 million, owing to the “unsold comparable stock in the area”. It is expected to appeal to American or Asian buyers aged below 40.
A townhouse in Belgravia initially listed at £17 million in 2024 was eventually sold at £14.95 million to a European family relocating to London.
An end to the war in Ukraine could result in a lifting of UK sanctions, which would enable Russian buyers to return, Mr Finch said.
But with Russian buyers gone for now, sales to wealthy Americans rose from 18 per cent in 2023 to 25 per cent of all buyers of super-prime properties, according to Savills. Buyers from the Middle East account for 20 per cent of all sales, an increase of 2 per cent on the preceding year.
The price of a home per square metre in London had dropped by a third over the past decade, with $1 million buying 34 square metres (365 sq ft), whereas it only bought 23 square metres (248 sq ft) a decade ago, according to Knight Frank’s Wealth Report.
But the drop in value alone was not enough to lure buyers back in the amounts needed to lift the luxury property market out of its slump. “London is undervalued,” Mr Finch said. “But we need volumes of people coming back to London and bolstering the market. So many new bits of legislation and taxes have made London look unfriendly to investors.”
He is confident, though, that the super-rich will return. “London is still London. They’d rather be here than Dubai or Turkey,” he said.