House prices in prime central London have fallen by almost 12% in the second quarter of this year, according to Land Registry figures.

Analysis of the results by asset management firm London Central Portfolio said the central London market was “fragmenting” due to taxes which were targeting the upper end of the property market, such as increased stamp duty for properties above £1.125m and the annual tax for enveloped dwellings, which now extends to properties worth more than £1m.

Despite an annual growth figure of 6.6%, the figures show that prices have fallen 11.9% on those of the first quarter of 2015.

However, prices in the flats and maisonettes sector in prime central London have seen above average growth, with a rise of 1.7% on the first quarter and by 11.9% over the past 12 months.

Naomi Heaton, chief executive of LCP, said: “The new quarterly Land Registry results confirm the current state of play in the market, where there is a fast lane and a slow lane, with the brakes firmly on at the more expensive end.

“This comes as no surprise. Pre-election clouds loomed over central London for many investors at the beginning of the year, suppressing buyer activity. Ramadan and the traditionally quiet summer period has held back any conspicuous recovery.

“Coupled with some hard to swallow taxes for higher end properties, this period of subdued sales and price growth was anticipated.

“However, those targeting the mainstream private rented sector, ducking under the £1m mark, are still making sound investment decisions. As a commercial asset class, this market tends to be far less volatile and we anticipate a strong performance as investors return to the market.

“One word of warning: current annual growth levels of nearly 12% for flats and maisonettes are unlikely to be sustained. For the last four decades, average growth has been 10.4% per annum, so a tapering off of quarterly growth rates is still likely, to bring prices back in line with long-term trend.”

Overall average property prices in prime central London have grown by 8.3% in the past year, now standing at £1.509m.

Transactions fell by 21% over the same period, amounting to 5,170 for the year – the lowest since 2009. This figure was exacerbated by an annual collapse of 27.6% in the houses sector.

Average prices in the second quarter of this year across Greater London as a whole now stand at £537,308 – an annual growth of 6.7% and up 2.2% on the first quarter of this year. Transactions in Greater London were down 9% over the last year.

Across England and Wales average prices in the second quarter stand at £265,776 – an annual growth of 4.4% and up 1.4% on the first quarter.

A total of 844,030 sales took place over the year, with sales up 18.4% on the first quarter of this year.

Excluding London, average prices now stand at £227,871, according to the Land Registry’s quarterly data. The figure is vastly different from the £181,619 quoted in the Land Registry’s most recent monthly House Price Index for June, as the two figures are arrived at using different criteria.