Fancy a flat in Kensington or a townhouse in Hampstead? You might be in luck. It seems wealthy buyers aren’t snapping up luxury London properties as quickly as they were.

A new report by Benham and Reeves, the estate agents, shows demand for prime property in London has dipped this autumn.

Their “Prime London Demand Index” looks at how many homes are actually being sold in different areas – and how that compares to last year.

Prime Property Demand Down

So, what’s going on? Well, across London, just 16.9% of prime properties found buyers in the three months to October. Prime properties are those priced between £2 million and £10 million. That’s a drop of 2.5% compared to the summer.

Where Are Buyers Losing Interest?

Some areas saw bigger drops than others:

• Battersea: Demand plummeted by 7.8%.
• Chiswick: Also saw a 7.6% drop.
• Islington: Experienced a similar 7.6% decrease.

Bright Spots in Hampstead and Richmond

It’s not all doom and gloom, though. A few areas bucked the trend:

• Hampstead: Enjoyed a 4% surge in demand, reaching 19.6%.
• Richmond: Wasn’t far behind with a 2.2% increase.

Super Prime Still Sluggish

What about homes for the super-rich? The news isn’t great there either.

Just 2.6% of “super prime” properties (those costing over £10 million) found buyers. That’s down 2.6% on last year.

A Labour of Love Lost?

So, why are wealthy buyers hesitating? Marc von Grundherr, a director at Benham and Reeves, thinks it could be down to the new Labour government.

He believes Labour’s plans to tax the wealthy are making rich buyers think twice before splashing out on a mansion.

Labour wants to increase Capital Gains Tax (paid on profits when you sell an asset) and shake up Inheritance Tax (paid on money you inherit). These changes could hit wealthy property owners hard.

Uncertainty Rules for Now

With the Autumn Budget looming, everyone’s waiting to see exactly what Labour will do. Until then, expect the luxury property market to stay a little bit shaky.