The latest Coutts London Prime Property Index shows a mixed picture for the capital’s high-end housing market in the first quarter of 2025. Average prime London property prices dropped by 2.6%, down 1.6% year-on-year and 10.8% below the market peak in 2014.
Some of the capital’s most prestigious areas, including Knightsbridge and Belgravia, saw prices fall more than 20% from previous highs. For dollar-based buyers, the opportunity is even more pronounced, with a weaker pound compared to 2014, effective discounts reach around 40%.
Despite falling prices, sales volumes rose 4.4% compared to the same period last year. Buyers have benefited from a more active market, with new instructions up 25% year-on-year and 33% above the 10-year average. The total stock of prime homes for sale increased by 8.7%.
Negotiating power also shifted in favour of buyers. Average discounts on prime properties reached 9.3%, the highest level seen in five years and 82% of transactions were completed below asking price. Some of the steepest reductions were found in central areas like Mayfair & St James’s (15%) and Knightsbridge & Belgravia (12.5%).
However, price trends varied across the city. King’s Cross & Islington reached a record high of £1,683 per square foot. In outer-prime areas such as Battersea, Clapham & Wandsworth and Hampstead & Highgate, discounts were below average at 5.6% and 6.9% respectively. Sales volumes, while improved from last year, remain 12.9% below the 10-year average.
In contrast, the super prime segment, typically driven by international cash buyers, emained resilient. Prices rose 5.1% year-on-year, with sales up 4.2% and 12.8% above the 10-year average. Knightsbridge & Belgravia recorded the highest number of super prime deals in Q1.
“The prime London property market is going through a period of change," comments Coutts real estate director Katherine O’Shea. "Whilst discounts were up, sales were down, reflecting a cautious market. Much of the activity in the first part of the year was driven by buyers such as families looking for more space in outer-prime areas like Battersea, Clapham & Wandsworth, Wimbledon, Richmond, and Putney & Barnes."
“As we look ahead, the prospect of improving mortgage rates, alongside London's sustained reputation as an attractive location for investing in prime property, should help stabilise the market.”
