The hairdresser, aged 55, was found by her older sister, Yioda, on the evening of 25 December.
The Metropolitan police said they were called by the London ambulance service shortly after 7.30pm on Wednesday to reports of the sudden death of a woman. Her death is not being treated as suspicious.
In a statement through their lawyer, Panayiotou’s family said: “We can confirm that very tragically, Melanie has passed away suddenly. We would simply ask that the family’s privacy be respected at this very sad time.”
Michael was close to his sister and left £50m in his will to the makeup artist, who used to cut her brother’s hair as she travelled with him. Yioda Panayiotou also inherited a large part of his estate.
On 23 December, Panayiotou had issued a Christmas message alongside her older sister, their father, Jack, and Michael’s former manager David Austin.
“We have come full circle again, and Christmas time (and the holidays) are upon us once more,” they said.
“I think we as a family (there are lots of us, we Greek Cypriots, we’re everywhere) have come to fully appreciate (although we already knew really) quite how much love there is out there in the world, for both Yog [Michael’s nickname] and his beautiful music.
“We know how much his lyrics can offer support when things are tough and help celebrate when times are good and life is going well … and that is just as powerful now as if he were still with us, and as many of you say in your messages, it’s a gift.”
The note ended by telling people not to forget to send messages of love to those closest to them.
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