Drop in demand for prime Chiswick properties

The latest Prime London Demand Index by Benham & Reeves has revealed that demand for prime property in London fell by 2.5% in the third quarter of this year.

The most significant drops in buyer appetite were in Battersea, which fell 7.8%, Chiswick at 7.6%, and Islington also at 7.6%. This decline follows a promising uptick in Q2. The index tracks demand for properties in the prime market - £2m to £10m range - as well as super prime properties above £10m.

It measures demand by the proportion of homes listed for sale that have found buyers subject to contract. In the prime market, 16.9% of properties found buyers in Q3 2024, reflecting a 2.5% drop from the previous quarter.

RICHMOND SAW QUARTERLY GROWTH OF 2.2%

Prime demand was also down 2.6% compared to last year, although this was an improvement from the previous quarter’s 3.8% decline. Hampstead recorded the strongest demand increase, rising by 4% to 19.6%. Richmond saw quarterly growth of 2.2%, followed by Pimlico at 1%, Clapham at 0.1%, and Marylebone at 0.1%. These are, however, the only prime markets to record an uptick in demand.

DEMAND IN SUPER PRIME

In the super prime market, only 2.6% of properties found buyers in Q3 2024, showing a slight increase of 0.4% from the previous quarter, but a decline of 2.6% compared to the previous year.

Victoria recorded the largest quarterly increase in super prime demand at 3.1%, with Knightsbridge at 2.9%, Belgravia at 2.3%, Kensington at 1.5%, Mayfair at 0.6%, Marylebone at 0.4%, St. John’s Wood at 0.2%, and Holland Park at 0.1% also seeing increases.

The largest quarterly drops in super prime demand were in Chelsea at -2.3% and Hampstead at -1.8%.

WEALTHY BUYERS AWAIT LABOUR TAX PLANS

Marc von Grundherr, director of Benham and Reeves, said: “London’s prime market is a step removed from the general housing market, and so it rarely moves in line with the capital’s overall narrative.

“While the new Labour government might be bringing a new sense of optimism and security to prospective buyers elsewhere on the market, Keir Starmer’s promises to target wealth as a way of increasing funding for public services is likely a major reason for a decline in demand in London’s prime market.”

He added, “Labour plans to penalise wealth through things like a hike in Capital Gains Tax and an overhaul of Inheritance Tax legislation, both of which are major considerations for wealthy property buyers looking to spend multi millions on a home.

“There remains uncertainty around the exact scale of Labour’s changes, so it’ll be interesting to observe prime demand after the government’s full hand is revealed during the Autumn Budget on 30th October.”

Image: Chiswick Mall https://www.harpersofchiswick.com/chiswick-intel/chiswick-mall