London's Luxury Property Market Sees 10% Price Drop Amidst New Super Homes Launch

In September, sellers of properties in prime London postcodes experienced an average discount of 10.1%, contributing to an overall 7.1% decrease in sale prices compared to the previous year. Property analysts LonRes reported the lowest number of sales for any September since 2016, with transactions down 16.8% from September 2025 and 13.9% below the 2017-2019 pre-pandemic average. However, properties valued over £5 million showed a more resilient trend, with transactions falling by 12.5% while new instructions surged by 32.5%.

Buyers continued to secure properties well below asking prices. Compared to pre-pandemic levels, prices were 8.2% lower in September. For homes exceeding £5 million, discounting increased by 0.8%, but this was still 88.8% higher than the 2015-2024 period. A notable example is the sale of a mansion overlooking Regent’s Park, formerly owned by Addison Lee founder John Griffin. Griffin sold the property for £11.5 million in early October, significantly less than his £20.7 million purchase price 13 years prior. The property had undergone multiple discounts without success.

LonRes advised that in a softening market, setting a competitive initial asking price is crucial, as prolonged market exposure necessitates larger discounts for a sale. Between July and September, the average discount for homes sold within three months was 3.8%, escalating to 11.1% for properties taking six to 12 months to sell. The market for properties above £5 million is showing signs of activity, with a 32.5% increase in new instructions compared to the same month last year and a 63.6% rise above the 2017-2019 average.

LonRes indicated that super prime sales are susceptible to market fluctuations driven by news and speculation, leading to an inconsistent market. Nick Gregori, head of research at LonRes, commented that while September activity improved from the summer lull, it remained subdued for the season, with achieved prices continuing to decline due to buyer hesitancy. He identified borrowing costs, a perceived lack of future growth, global uncertainty, and inflation fears as key factors dampening demand. Gregori anticipates no significant positive changes for prime property buyers in Chancellor John Healey’s upcoming budget on October 28, with the best hope being the avoidance of further detrimental policy shifts. Reports suggesting the mansion tax threshold will not be lowered from £2 million to £1.5 million are likely to be welcomed by a market seeking stability.

The £5 million-plus market is particularly affected by uncertainty and weaker sentiment, as a higher proportion of discretionary buyers and sellers reduces the urgency for transactions. Knight Frank's Residence Report highlights a growing scarcity of large new build apartments in Westminster and Kensington & Chelsea, with less than 3% of completed homes exceeding 200 sq m, making 'super prime' residences rare.

Recent high-value property releases include a £15.5 million, 3,100 square foot, four-bedroom duplex penthouse at 100 George Street in Marylebone, developed by Native Land. This development has been one of the fastest-selling in prime central London. The penthouse features bespoke interiors by Eloisa Cuturi and commissioned artwork. Nicholas Gray of Native Land noted the exceptional rarity of newly built Marylebone homes of this calibre, scale, and quality. Rupert des Forges of Knight Frank confirmed sustained buyer demand for large, turnkey homes in prime central London. Additionally, a £20 million penthouse has been listed at Southbank Place, the final phase of a £1 billion development by Braeburn Estates, a joint venture between Qatari Diar and Canary Wharf Group.