Estate agent Savills warned that the combination of Stamp Duty and sentiment weakened by Brexit, meant further price cuts could be seen.
As a result of the prolonged slump the most expensive properties in London are now valued at around 6% less than three years ago, compared with southern England where top properties have increased 7% and in the midlands and north by 3%.
However, over a five-year period all of southern England including London had seen prices increase by at least 10%, according to the latest Savills data.
In contrast, those in the midlands and the north grew more modestly (3%) and in Scotland have fallen by 5%.
Savills noted that even at the very top end of the market, in the £10m+ range, values appear to be stabilising, thanks in some part to the fall in the pound following the Brexit vote attracting international buyers.
It added that these higher value, more discretionary markets were expected to ebb and flow with the Brexit news agenda over the next few years, leaving prime London values flat and the potential for only marginal growth in regional markets.
“Brexit uncertainty has compounded the cooling effect of Stamp Duty, but it now looks as though values are finding their level and where asking prices reflect this, buyers are coming back into the market,” said Savills head of UK residential research Lucian Cook (pictured).
“However high levels of over-priced stock remain in the market, some still pegged to peak values, suggesting we have probably not yet seen the end of asking price cuts.
“And though it looks as though the bulk of value falls are behind us, with Article 50 to be triggered this week, we expect the market to ebb and flow for the next two years, in step with the news agenda,” he added.