London is to see a boom in the construction of luxury properties over the next 10 years, new analysis has suggested.

According to research from consultant Arcadis, some 35,055 top-end homes will be built in the capital over the coming decade.

The figure is an increase of 40% on the last prediction from 2014, when it was thought the number of such properties built would be 25,000.

In total, the sales value of these homes will come in at around £77 billion.

They will be mainly flats and apartments valued at more than £1 million, and will cover upwards of 40 million square feet.

Yet despite this projected surge in construction, demand for such properties is actually falling, according to the research.

This could mean that a number of the projects end up being repurposed as commercial properties, or even downgraded to become cheaper homes.

The fall in demand is also leading some developers to re-evaluate the money they had planned to spend on areas such as interior design and fit-out specifications.

Mark Cleverly, head of commercial development at Arcadis, said the house-building sector in London is one of the strongest around.

But he added that a number of factors are also having an impact on the state of the industry, which could require developers to adapt.

“Since around 2009, the value of prime residential property in central London has seen dramatic rises, making it one of the hottest markets in recent memory,” he said.

“That said, things are changing. Land, materials and labour are growing in price, meaning the costs involved in actually building these homes is growing significantly.

“This, coupled with a recent gradual easing off of buyer demand, could affect margins and mean investors opt to convert their developments to target the more buoyant office and commercial markets.”

Greater London will see 3,650 construction jobs created every year for the next five years, according to CITB’s latest Construction Skills Network report.