Transaction volumes across all of London are 48 per cent lower than they were a year ago, claims an estate agency - and in prime parts of the capital, transactions are 60 per cent down.
London agency Portico says that in Westminster in April this year, after the deadline for investment buyers to beat the April 1 stamp duty deadline, volumes dropped to below 100 transactions in a month to a record low of 84.
Transaction volume levels have remained “critically low” since that time, the agency says.
It claims prices are only just beginning to show annual drops - although other agents have reported falling prices for some time - but Portico says the year to the end of September 2016 saw a 1.1 per cent drop in values.
The agency predicts price falls of up to seven per cent in central London next year, filtering out to other parts of the capital.
It says that in theory price drops could improve affordability and create opportunities for first time buyers but it accepts that “this is a scenario unlikely to happen any time soon.”
“Unless action is taken to re-establish the natural movement of the whole market it’s likely this could be a serious issue and we will see prices fall” warns the firm’s regional sales director Mark Lawrinson.
Last month, Knight Frank issued a report which talked starkly of the prime central London troubles. The agency's research department warned that "buyers remain exceptionally price-sensitive" and admitted sales of PCL properties priced between £2m and £5m so far this year were a third lower than in the same period of 2014.
Last week the agency’s latest research suggested prices in parts of prime central London will have fallen seven per cent throughout 2016.
Meanwhile buying agency Garrington has produced a league table of areas in the Home Counties that are now seeing larger house price rises than London.
Some predictable locations appear - Oxford, St Albans and Canterbury - but there are also less usual names when compared to the capital’s housing market, such as Brentwood, Reading, Hertford and Maidenhead.