The million-pound property market is booming with prices up, discounts down and sales surging.

Despite ongoing global uncertainty, London continues to be a safe-haven for high-end homes with 13% more properties sold compared to the 10-year average. In Q2 2022, 793 prime properties were sold, versus the 10-year average of 704, according to the latest Coutts London Prime Property Index (CLPPI) – which reveals overall trends and what’s happening area-by-area across the capital.

The cost of prime and super prime homes in the capital – those that cost £1 million or £10 million or more respectively – is 7.8% higher compared to this time last year, with double-digit rises in some areas such as Hampstead and Highgate (up 13% compared to this time last year).

Prices are now only 6.7% below their peak in 2014, showing that the million-pound property market in London is bouncing back with the window of opportunity to buy something ‘cheaply’ closing.

Please mind the gap – between inner and outer London

The exodus away from the centre of London at the height of the pandemic is waning, with central London properties even more expensive than those outside of the centre. The difference between property prices in inner and outer London is now 58%, up from 49% at the start of the year.

Whereas it was possible to ‘scoop up a bargain’ in Knightsbridge and Belgravia in 2020 and 2021, house prices there have jumped 14% in the last three months with buyers wanting to be back in the centre of town.

Demand high and availability low

High demand for properties and low availability of stock, means it is also now harder to negotiate on prices. Prime property purchasers received less than 6% off the asking price of homes in the last quarter, the lowest figure seen since the start of this research in 2016.

This was more acute in areas such as King’s Cross and Islington. With the availability of homes available for sale down by almost a third (31.9%) and new listings down by more than a quarter (28.6%) buyers were only able to negotiate 1% off the average asking price in this area.

Katherine O’Shea, Director, Coutts Real Estate Investment Service, said: “Competition for luxury property across the capital is fierce this quarter as buyers are keen to snap up prime property.

“Whilst the ‘race for space’ that defined the pandemic is still being seen, central London is bouncing back. With the capital in full swing, homeowners are keen to be at the heart of the action.”