Carter Jonas has published its Spring 2026 Luxury Market Update, offering an overview of trends and activity in the UK high-end property sector.
The past year has been one of recalibration for the major luxury residential market in London and the wider English regions, the report said. After a strong 2024, both transaction volume and total investment declined. In prime central London, property values softened by around 3% to 6% and transaction levels declined.
Ahead of the Autumn Budget in November 2025, many buyers adopted a cautious “wait and see” approach, partly due to concerns over potential changes to capital gains tax. Once the Budget proved less disruptive than expected, buyer confidence began to be restored and 2026 opened with renewed optimism.
Looking ahead, the introduction of a high-value council tax surcharge affecting properties worth more than £2 million is expected to impact market decisions. Although the surcharge will not take effect until April 2028, the Valuation Office agency will begin valuations in 2026, and potential buyers are already factoring the estimated £2,500-£7,500 annual cost into their calculations.
London
London’s prime luxury market declined significantly in 2025, with transaction volumes down nearly 65% compared to 2024. Total investment fell from £7.8 billion in 2024 to about £2.2 billion last year. Sales of properties over £5 million fall from 750 in 2024 to just over 200 in 2025. The report said these figures are not yet final due to a two to four month lag in land registry filings, and the total is expected to increase as more data is filed.
regional England
The rest of England saw a downturn for properties worth more than £1.5 million. Transaction volumes are expected to decline by 55%, from just over 4,300 in 2024 to 1,900 in 2025, while total investment will fall from around £10 billion to around £4.1 billion in 2024. Like London, these figures are likely to be revised upwards as more sales are recorded.
Samuel Richardson, head of sales at Carter Jonas in Mayfair, said: “London’s luxury property market is entering 2026 with renewed confidence after several years of slow activity. Momentum is forecast to pick up again as buyer sentiment improves in prime central London, supported by easing mortgage rates, rising wage growth and softer pricing compared to the post-pandemic peak.
“International buyers remain a major force, attracted by London’s global appeal and the relative value on offer. Overall, 2026 is shaping up to be a steadier, more optimistic year for the capital’s high-end market.”