Executive Summary

SJW Properties — London Residential Property Market Report · Q2 2026 In the second quarter of 2026, the London property market entered a more rational phase of adjustment. The shift was not a matter of the market simply rising or falling; rather, its distinct segments (Market Segmentation) began to follow markedly different trajectories. Policy changes, financing costs, rental-regulation reform and the global reallocation of capital together reshaped how buyers and sellers make decisions.

Five Key Observations

● 1. London can no longer be viewed as a single market. It is better understood as four principal segments: Super Prime, Prime London, Education and Buy-to-Let.

● 2. Policy changes continue to influence investor decisions across three dimensions: rental regulation, taxation and financing costs.

● 3. Buyers have become more sophisticated, paying closer attention to lease length, service charge, ground rent, holding costs and future liquidity.

● 4. In Prime London, room for negotiation has widened, and cash buyers and long-term owner-occupiers are gradually returning.

● 5. Education-driven demand remains stable and is among the most resilient segments of the London residential market today.

SJW Frontline Observation

● Overseas landlords are showing a markedly greater willingness to sell.

● In the New Home Resale market, transaction prices on some schemes have corrected by roughly 15%–30% from their peak.

● Super Prime buyers continue to focus on scarce assets, but their price sensitivity has risen significantly.

● The market is gradually shifting from being “price-driven” to “value-driven”.

Key Insight

The London property market is no longer defined by one trend, but by multiple markets moving at different speeds.

Sources: Gov.uk · HM Land Registry · Bank of England · ONS · BBC · Knight Frank · Savills ·

LonRes · Coutts · SJW Frontline Market Observation