Transactions and pricing in Chelsea, southwest London, are recovering after experiencing the biggest stamp duty-related price adjustment of any prime London property market, according to James Pace, head of Knight Frank’s Chelsea office.

In March, prices in Chelsea were 15.5% below the previous prime central London peak, which was recorded in August 2015. It was the largest decline of any PCL market. The fall was also higher than any prime outer London market since its last peak in July 2016.

In an indication of how price declines in Chelsea are now bottoming out, the fall was -1.9% in the year to March. This compares to an annual decline of -12.6% recorded in March last year.

“Activity in Chelsea is linked to a fairly traditional group of buyers and sellers who are driven by their job, schools or a need to downsize,” said Pace, who added, “they are typically UK or European owner-occupiers which means, for example, demand has been less supported by international investors.”

Underlining how price adjustments have boosted sales volumes, the total value of sales in Chelsea in December 2017 was the highest since July 2014. In the same month, eight deals were recorded above £5m, which was the highest total since March 2014.