Property prices in central London have fallen by nearly 20 per cent, according to new figures from the Office for National Statistics. In Westminster, house prices dropped 19.6 per cent compared to a year earlier, reaching an average of £815,000 in April.
London Property Prices Fall for Ninth Consecutive Month
Across the capital, property prices fell for the ninth month in a row, with an annual decline of 2.1 per cent. This marks a continued downturn in the London housing market, though some boroughs saw modest increases.
Rents Continue to Rise
Meanwhile, rents in London rose by two per cent in the year to May, reaching an average of £2,294 per month. This was the smallest increase across the country and similar to the previous month's rise.
Boroughs with Biggest Falls
After Westminster, the second biggest fall in London’s property prices was in Tower Hamlets, where prices dropped 12.6 per cent year-on-year to an average of £458,000. Kensington and Chelsea saw a decline of 8.4 per cent to £1,273,000. In Hammersmith and Fulham, prices fell 7.6 per cent to £742,000, while Islington dropped 5.4 per cent to £665,000. Wandsworth recorded a 5.3 per cent fall to £671,000, Hounslow fell 4.7 per cent to £497,000, and Ealing decreased 4.2 per cent to £557,000.
Boroughs with Rises
Most other boroughs experienced smaller drops or slight increases. Waltham Forest saw a 3.4 per cent rise to £524,000, Redbridge increased 2.7 per cent to £503,000, and Bexley rose 2.5 per cent to £408,000.
Expert Analysis
Sarah Coles, head of personal finance at AJ Bell, commented: “London prices haven’t fallen off a cliff, and it’s not a straight line – prices were actually up 1.9 per cent between March and April - but there has been a drift south. It’s partly that the market is a victim of its own success. Average house prices are so much higher than elsewhere in the UK that buyers are being priced out, and at a time when mortgage rates have risen from rock bottom, it’s increasingly difficult for people to get onto the property ladder or move up it.”
Overall, across the capital, the average property price fell to £615,000. Central London was less impacted by stamp duty changes last year than other parts of the country. The ONS stated: “The SDLT (stamp duty) changes had minimal impact on areas such as London where average prices are higher. Prices fell by 2.1 per cent in the 12 months to April 2026. This is the ninth consecutive month in which London has seen an annual fall in house prices.”
Across the UK, house prices increased by 3.8 per cent annually to April, taking the typical property value to £270,000.
Richard Donnell, executive director of research at Zoopla, said: “The jump in house price inflation in May is artificial and linked to the ending of last year’s stamp duty holiday. The sales market is weakening as we enter the summer with buyer demand down 14 per cent on this time last year, yet there are still more homes for sale. It’s a buyers’ market and the North-South divide in prices and market activity remains. People want to move but serious sellers need to price their home carefully.”
Latest inflation figures on Wednesday showed it was unchanged at 2.8 per cent in May, lower than expected by the City, fuelling speculation that the Bank of England will not raise interest rates in coming months.
