Chelsea house prices fell by as much as 13 per cent year-on-year in January as vendors were forced to drop prices due to higher transaction taxes.
Data from estate agents Knight Frank shows prices on high-end homes have dropped sharply in London's most sought-after neighbourhoods. In Kensington and Notting Hill, prices have fallen by 12 per cent and 10 per cent respectively.
London's prime property market has been rocked by former Chancellor George Osborne's stamp duty hikes on homes worth more than £1m. Asking prices on some properties in central London have tumbled by more than 30 per cent.
Overall, prime central London house prices fell by 6.7 per cent year-on-year in January.
Tom Bill, head of London residential research at Knight Frank, said the Brexit vote had been a "catalyst" for price reductions in some cases, but that stamp duty changes were having a bigger effect on the market.
"While Brexit and Donald Trump dominate the wider political and economic landscape, it would be wrong to overstate their impact on the prime London property market," Bill said.
"Higher rates of stamp duty are still a bigger issue than the prospect of Article 50 being triggered in March."
Price growth by price band
|up to £1m||£1m to £2m||£2m to £5m||£5m to £10m||over £10m|
|6 months||-4.7 per cent||-6.3 per cent||-6.0 per cent||-5.3 per cent||-5.5 per cent|
|1 year||-4.2 per cent||-6.7 per cent||-7.1 per cent||-7.2 per cent||-6.8 per cent|