By Camilla Dell for PrimeResi.
Vendors are ‘on the ropes,’ says buying agency boss, as she reports ‘record discounts & exceptional value across Prime Central London’. But buyers still need a deft touch to secure a good price.
For optimistic thinkers, London’s market in mid-2026 represents a real opportunity to acquire best-in-class property at realistic prices — a view we wholeheartedly share (writes Camilla Dell, founder of Black Brick). Our team has been achieving record discounts and uncovering exceptional value across Prime Central London.
Vendors on the ropes – but it takes skill to land a knockout blow
The American politician Jacob Lew was White House chief of staff for Barack Obama and later the US’s ambassador to Israel. Safe to say he has had his fair share of difficult conversations. His advice on how to horse-trade is especially pertinent in London’s prime property market right now: “The most critical thing in a negotiation is to get inside your opponent’s head”.
London is certainly a buyers’ market right now. Whilst house price analyst LonRes reports that transaction numbers have increased by 2% in the past year, indicating buyers are inching back into the fray, average sale prices are down 5%.
This is naturally frustrating for vendors, many of whom started out with over-ambitious ideas about what they think their properties are worth and have had to trim back both their expectations and their asking prices. Others have given up on selling altogether – LonRes found that the number of homes withdrawn from sale in the capital has jumped by almost 60% in the last year.
Given the fragile sensibilities of these bruised homeowners negotiating discounts is an extremely delicate business.
I always advise clients to avoid making an insultingly lowball offer on a property they have their heart set on. In reality, the majority of central London homeowners own their homes outright, and can afford to wait for a sensible offer.
I always advise clients to avoid making an insultingly lowball offer on a property they have their heart set on
Starting off negotiations on the wrong foot can backfire. You have to think beyond just: “Is this property a really good deal?”. If it is something which is rare, which really suits you, and which won’t come up all the time, then we have buyers who will decide that although a property isn’t a steal, they love it and want it, and will own it forever.
Tom Kain, a partner at Black Brick, says that the added value a buying agent brings is their ability to glean as much information about the vendor’s situation as possible, and pitching bids accordingly. “Sometimes we will make a low offer and then just leave it on the table for a week or two,” he said. “The psychology of buying is a very delicate thing.”
A taxing problem
Fears that the Government would impose a draconian “Mansion Tax” on high value homes put the brakes on the prime market for months as buyers awaited clarity about how much they might have to pay to own a home in London.
The reality, announced in November, was considerably better than many had feared. But its implementation may prove to be a longer-term headache.
From 2028 owners of homes valued at £2m-plus will pay an annual surcharge on their Council Tax. The levy will range from £2,500 p.a. for homes worth up to £2.5mn up to £7.500pa for homes worth more than £5mn. The vast majority of those properties are, of course, in central London.
As ever with these sort of root-and-branch changes the devil is in the detail.
Current Council Tax valuations are woefully out of date. Before charges can be made the government will have to carry out a wide-ranging valuation exercise. It has confirmed those charges will increase annually in line with inflation, with revaluations will happen every five years going forward.
Exactly how this can be achieved remains to be seen. Late last month the Government launched a consultation on its proposals, confirming it intends to use AI, alongside “professional valuer judgement” to assess individual properties, based largely on recent local sales data.
But I am a million per cent certain that a simple comparison with other nearby home sales will not produce an accurate valuation on a PCL property. What it would have to do is actually physically go into those comparison properties and actually compare them – everything from their ceiling height, to their condition, to their aspect and views. These little nuances can make a massive difference.
I am a million per cent certain that a simple comparison with other nearby home sales will not produce an accurate valuation on a PCL property
The tax is also likely to have a major impact on London’s prime rental market, since the Government expects the owner of the property to pay the surcharge. For landlords it means an extra up to £625 per month to find at a time when London rents have begun to plateau after years of inflation-busting growth during the pandemic. According to the Government’s Office of National Statistics, London rents increased 2%in the year to March.
The shockwaves of conflict
Property consultant JLL has downgraded its forecasts for Prime Central London property prices, blaming the war in the Middle East for damaging buyer confidence.
Pre-war the firm had expected 2026 to “usher in a new phase of the housing cycle”, with cuts in interest rates underpinning the plateauing of prices in Central London after several years of annual falls.
But central London is a discretionary market which is hugely impacted by sentiment, and on that basis JLL believes that prices will fall by 5.5% in central London by the end of 2026.
The picture elsewhere is more positive. Beyond central London buyers tend to be more needs-based – first time buyers keen to get out of the rental trap, families upsizing, relocators looking for a home in a London village. But JLL forecast that a combination of rising inflation and higher-than-expected interest rates means that it will also experience a price fall this year, of 2.5%.
Far from being deterred by the prospect of further price falls, our buyers appear to be excited by the opportunity the current market affords them. What is coming up is that lots of clients feel that the current market is a good buying opportunity. We have a European client who has always wanted a PCL property and has been watching the market for years. He thinks that it is now good value.
Although the wider PCL market is generally sluggish, with buyers not feeling a huge sense of urgency to move, there are also sweet spots where buyers need to be on their toes. Kain said freehold houses in the £2mn to £5mn bracket, in good condition still attract considerable competition and sell well in PCL. “The market is very nuanced,” he said. “I have a client currently looking for a mews house in Mayfair or Belgravia in that price bracket, and it is surprisingly active out there. The key to success is gaining access first to compelling deals, such a receivership deals, before they reach the open market. This is where working with us gives buyers the edge and a first mover advantage.”
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