Transactional activity in London’s £5 million-plus market returned to pre-pandemic levels in 2025, a result of the compounding effect of increased taxation and non-doms changes over recent years. But an improvement during the final quarter suggests confidence is beginning to return.

There were 105 transactions above this price point in Q4, up 7% on Q3 levels. This brings the overall number of transactions to 412 over 2025, 11% lower than 2024 but 34% higher than 2019. For the market above £10 million, there were 119 transactions over 2025, and Q4 recorded the highest number of transactions in a single quarter.

A ‘better than feared’ outcome of the Budget offered buyers some clarity, stimulating activity during the last few weeks of 2025, as buyers continued to place their confidence in London’s prime postcodes. Activity was focussed on best-in-class and trophy assets, underpinned by scarcity at the top-end. Furthermore, price adjustments and improving market sentiment have encouraged buyers to take advantage of where values sit.

Over 2025, buyers spent £4.09 billion on homes priced at £5 million or more across the capital, a 19% fall on the year previous. The market between £5–10 million, which sees a higher proportion of domestic buyers, was the most resilient, with transactions falling by only 3%. By contrast, the more discretionary £10-15 million market experienced a more significant decline of 31%.

London’s lifestyle attraction remains

International buyers continue to be attracted to the London lifestyle. The largest proportions of £5 million-plus sales took place in Mayfair (12%), followed by Chelsea (11%) and Kensington (10%).

More generally, many are assessing their options and choosing to split their time across different destinations, rather than opting to exit the market, as they remain conscious of repurchasing at a higher price point in the future.

Middle Eastern buyers remain prominent across the £5 million-plus market, attracted to the capital’s lifestyle and often seeking secondary residences for the next generation. Additionally, as economic uncertainty lingers across the US, we have seen an uptick in activity from American buyers. Across prime central London, 17% of buyers in the £5 million-plus market were from North America over 2025, compared to 9% the year prior.

OUTLOOK

Looking ahead, the post-Budget improvement in activity is expected to continue.

As global wealth is on the rise, and amid geopolitical uncertainty, we may have expected greater safe haven flows to the capital. However, increased taxation and regulatory policies, in addition to non-doms moving their residency elsewhere, have tempered this prospect. As a result, we are forecasting modest falls of -2.0% across prime central London over 2026.

Stable inflation, lower interest rates and increased global wealth will provide a more steady environment from 2027 onwards. We are therefore forecasting an 8.1% increase over the next five years. A stronger recovery relies on a more welcoming environment for wealthy individuals.

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