Growth in demand for super-prime properties in prime central London has slowed significantly, fresh data shows.
According to Knight Frank, the number of super-prime - £5,000-plus per week - tenancies agreed in London in the year to August was 5% higher than the previous 12-month period, which marks a major slowdown from the 20% uplift seen earlier this year.
Tom Smith, head of super-prime lettings at Knight Frank, attributes this to two factors.
“First, political uncertainty has made some people slightly apprehensive about the next six months,” he said. “Demand above £8,000 per week tends to be more discretionary, and we have seen the number of deals dip this year.”
There were just 17 tenancies agreed at a rent of £8,000-plus per week in prime central London between January and August 2018, down from 26 during the corresponding period last year and 27 in 2016.
The second factor is the stabilisation of the super-prime £10m-plus sales market.
Knight Frank says that despite the political uncertainty, higher rates of stamp duty are now reflected in pricing and buyer interest is rising as a result.
The total value of all super-prime sales between June and August was 93% higher than the equivalent figure in 2017.
As the market stabilises, some landlords of super-prime properties have begun to consider a sale more actively, according to Smith.
He added: “The owners of around a third of super-prime properties currently on the rental market would consider a sale at the right price. This is a higher proportion than we have seen for several years.
“Tenants are also starting to pay more attention to the sales market so I sense we are at the start of a period where more of them could become buyers, which is why tailored advice is absolutely critical.”