London House Prices See Fastest Annual Decline in Years

Average house prices in London fell 3.3 per cent in the 12 months ending July, the fastest annual decline in two and a half years. Data from the Office for National Statistics shows the average London home lost approximately £19,000 in value since its mid-2025 peak of £550,000.

The decline was most severe in high-end districts, with prices in Westminster dropping nearly 21 per cent and Kensington & Chelsea falling 14 per cent. While national prices rose 1.4 per cent to an average of £273,000, London and the south west of England were the only regions to experience year-on-year losses.

Analysts attribute the slump to a combination of rising mortgage rates, increased taxes, and a clampdown on landlords. In contrast to the drop in valuations, private rents continued to climb, increasing 3.5 per cent in London and 3.8 per cent nationally through August.