Why you can now find a bargain in London's family home hotspots
House prices have been falling consistently for more than two years, dropping almost 4pc in the past year alone, according to Savills.
In some areas, this has been far more extreme. In St John's Wood, Regent's Park and Primrose Hill, highly affluent areas historically frequented by artists and celebrities, prices have plummeted 14.2pc in the past year, according to LonRes. North Kensington recorded a drop of 8pc over the same period.
Properties are not selling, so house prices are being slashed. In central London's WC postcode, 18.6pc of home on the market have had their prices cut, according to property portal Zoopla. The capital's SW, EC, SE and W postcodes also feature in the top 10.
Of homes in central London valued at between £1m and £10m that sold in the first three months of the year, 82pc went for less than the asking price, according to data from Coutts. It said that the level of discounting is at a five-year high.
Across prime central London, values were 21.2pc lower in the first quarter of 2025 than in the peak in 2014, according to estate agent Savills. That marks a 42pc drop in real terms.
The Government's hostile policies towards wealth, combined with high interest rates, uncertainty and sky-high stamp duty have pushed many of the capital's wealthy, and largely international, residents to sell up.
But this has created a 'unique opportunity' to find bargains, estate agents say, and many British families are taking advantage.
'It's not all about non-doms'
An exodus of millionaires due to the Government's scrapping of the non-dom policy is the driving factor behind the slump. The UK is expected to lose more millionaires than any other country this year, according to advisory firm Henley & Partners, which predicted that a net 16,500 millionaires will leave Britain in 2025, up from 10,800 last year.
'I'm on the shop floor, and I speak to buyers and sellers – they are leaving. That's a fact, there's no getting past it,' explains Stuart Bailey, who looks after the prime central London market for estate agent Knight Frank.
But there are others who have also felt forced into selling up, he adds. 'It's not all about non-doms – that's an eye-catching headline term.
'There are wealthy entrepreneurial self-made Britons, who employ a lot of people here and own property, there are Americans who come here, and the 90-dayers too [who avoid paying tax in the UK if they spend less than 90 days here in a tax year].
'There's a perception of successive UK governments – not just this one – as being anti-wealth, and that has a big impact on sentiment. If one person leaves and speaks to their friends, they then decide that if their mates are going, they might go too. It feeds itself.'
'This is a unique opportunity'
The exodus of ultra-wealthy, more international buyers from the market is spurring other buyers into action. Many are British, explains Keith Rigby of estate agent Rigby and Marchant.
'At the moment there are more domestic buyers than overseas buyers… [British families] have the same anxieties and concerns as our international buyers, but they have different needs. They have ties to the schools here, and can't just up sticks and move to Dubai or Milan.'
Christian Lock-Necrews, of estate agent Winkworth's Knightsbridge branch, adds: 'It's more domestically led now. People feel like they don't need to be international billionaires to be able to compete. The market works again for British buyers, who have been the predominant [demographic] recently.'
British families prefer buying in areas that are still 'prime', but which are less central, adds Rigby. '[Areas such as] Shepherd's Bush, Chiswick and Queen's Park have continued to do well with domestic buyers, because prices there did not rise as quickly as the prime areas did between 2012 and 2016.'
In areas generally frequented by international residents, there is a glut of properties for sale, explains Charlie Ellingworth, of Property Vision, a buying agency.
'In Chester Square [in Belgravia], for instance, there are more than 20 houses on the market... Montpelier Square [in Knightsbridge], with Harrods as the local grocer, has nine houses on the open market and at least another three who could be persuaded.
'The 'international' market of central London is, at best, treading water and the areas further out – essentially 'domestic' – are trading quite strongly.'
Lock-Necrews believes that prices are now at their lowest. 'If you're buying now, I think this is likely to be the bottom,' he says.
'For me, [the prime central London market] has found its baseline. Those transactions are starting to take place again, people are spending. But it'll only be possible to tell when looking back in the rear-view mirror. From what I can see, this is a unique opportunity, and the people buying now will get the best of it.'
Bailey adds: 'There are people who have moved to Dubai, and they don't like it – I suspect that in due course, many intend or wish to come back. They're not necessarily happier there, but they feel forced out.'
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