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Property market crash could take almost seven years to reverse

The latest Prime Central London Buyer Demand Index by London lettings and estate agent, Benham and Reeves, has found that demand is up across the prime London market (£2m+) both on a quarterly and annual basis, but the super prime threshold of £10m+ has seen a drop in buyer demand in the third quarter of 2022.

The PCL Homebuyer Demand Index by Benham and Reeves monitors demand for homes valued between £2-£10 million and £10 million and above based on the ratio of properties listed online that have already sold subject to contract or gone under offer. E.g, if 100 homes are listed and 50 are already sold, the demand score would be 50%.

Prime Market – £2m-£10m

Across the core prime market, buyer demand has edged up marginally in the third quarter of this year, increasing by 0.2% to 25%, building further on the positive growth seen in Q1, but more notable, increasing by 2.4% on an annual basis.

Barnes (67.5%), Chiswick (57.1%) and Wandsworth (53.1%) are home to the current highest demand for prime properties.

Barnes has also seen the largest spike in demand versus Q2, with a 16.7% increase. Hampstead has seen the second largest increase at 7.9%, followed by Chiswick (6%). Islington has seen the largest quarterly decline with demand down -8.1% versus the second quarter of this year, along with Holland Park (-5.4%) and Maida Vale (-4.3%).

On an annual basis, Barnes again proves the most popular spot for prime property buyers, with demand up 23.2% versus last year. Canary Wharf has also seen one of the largest annual upticks (+17.2%), as has Battersea (14.9%).

Super Prime Market – £10m+

For the second quarter in a row, demand across the super prime market has fallen by 1%, down 1.9% when compared to this time last year.

Wimbledon is the hottest spot in London’s super prime market with current demand at 25%, followed by Highgate (16.7%) and Belgravia (13.8%).

Holland Park has seen the largest quarterly increase in demand at 4.8%, with Regents Park (+4.3%) and St John’s Wood (3.6%) also making the top three largest increases in quarterly buyer demand levels.

In terms of the largest annual boost to market activity, Highgate again tops the table with a +16.7% increase, followed by Belgravia (10.5%) and Victoria (8.6%).

Director of Benham and Reeves, Marc von Grundherr, commented:

“The London market may have failed to benefit from the same stamp duty spark that set the wider UK property market ablaze, but we have seen a consistent performance of late and signs of a slow but steady return to health.

This has been no different across the prime London market and a rejuvenated level of foreign interest has certainly helped to spearhead this increase in market activity.

However, the super prime market has yet to enjoy the same uplift and buyer demand remains down on both last quarter and this time last year. However, a weak pound now means that many foreign buyers are benefitting from a dramatic boost in purchasing power and while this is bad news for the wider economy, it could see prime London sales start to climb over the coming months.”

Prime – £2m+
Table shows current homebuyer demand and quarterly change for London homes priced £2m and above – sorted by highest current demand
Area	Prime category	Septemeber 2022 – Q3	Quarterly Change	Annual Change
Barnes	Prime SW London	67.5%	16.7%	23.2%
Chiswick	Prime SW London	57.1%	6.0%	13.3%
Wandsworth	Prime SW London	53.1%	5.4%	-0.9%
Highgate	Prime NW London	46.9%	3.5%	-0.7%
Clapham	Prime SW London	46.4%	2.5%	7.7%
Wimbledon	Prime SW London	45.6%	2.0%	-7.5%
Richmond	Prime SW London	41.3%	3.3%	2.6%
Putney	Prime SW London	34.3%	-2.2%	-2.8%
Islington	Prime N London	33.9%	-8.1%	-2.6%
Fulham	Prime SW London	28.0%	-2.4%	3.0%
Battersea	Prime SW London	24.1%	1.4%	14.9%
Hampstead	Prime NW London	23.3%	7.9%	13.1%
Notting Hill	Prime C London	21.5%	1.7%	-3.7%
Victoria	Prime C London	18.8%	-2.9%	3.8%
Holland Park	Prime C London	18.0%	-5.4%	-5.2%
Canary Wharf	Prime E London	17.2%	-2.8%	17.2%
Chelsea	Prime C London	16.5%	-0.3%	1.6%
Belgravia	Prime C London	16.4%	-3.9%	1.7%
Maida Vale	Prime C London	15.4%	-4.3%	1.3%
Kensington	Prime C London	15.0%	-3.1%	-1.6%
Pimlico	Prime C London	13.2%	0.2%	-0.9%
Knightsbridge	Prime C London	13.0%	1.3%	-2.2%
Mayfair	Prime C London	9.9%	2.3%	5.0%
St John’s Wood	Prime C London	9.8%	-1.5%	-1.4%
Regents Park	Prime C London	9.3%	-2.5%	-0.7%
Wapping	Prime E London	8.7%	-3.8%	-15.1%
Marylebone	Prime C London	6.0%	-1.4%	2.8%
Fitzrovia	Prime C London	2.8%	-2.8%	0.4%
Overall Average		25.5%	0.2%	2.4%

Super Prime – £10m+
Table shows current homebuyer demand and quarterly change for London homes priced £10m and above – sorted by highest current demand
Area	Prime category	Septemeber 2022 – Q3	Quarterly Change	Annual Change
Wimbledon	Prime SW London	25.0%	0.0%	-41.7%
Highgate	Prime NW London	16.7%	0.0%	16.7%
Belgravia	Prime C London	13.8%	1.7%	10.5%
Victoria	Prime C London	12.0%	0.9%	8.6%
Chelsea	Prime C London	10.3%	1.0%	2.4%
Marylebone	Prime C London	9.7%	0.3%	7.5%
Hampstead	Prime NW London	7.7%	-17.3%	1.4%
Kensington	Prime C London	6.5%	1.4%	-3.8%
Knightsbridge	Prime C London	5.7%	-4.5%	0.0%
Holland Park	Prime C London	4.8%	4.8%	-9.5%
Regents Park	Prime C London	4.3%	4.3%	-4.0%
St John’s Wood	Prime C London	3.6%	3.6%	-0.8%
Mayfair	Prime C London	2.5%	-0.1%	-0.4%
Clapham	Prime SW London	0.0%	0.0%	N/A
Maida Vale	Prime C London	0.0%	0.0%	0.0%
Pimlico	Prime C London	0.0%	0.0%	0.0%
Putney	Prime SW London	0.0%	0.0%	0.0%
Fulham	Prime SW London	0.0%	0.0%	0.0%
Fitzrovia	Prime C London	0.0%	-25.0%	0.0%
Notting Hill	Prime C London	0.0%	0.0%	-25.0%
Overall Average		6.1%	-1.1%	-1.9%

Data sourced from the major property portals (Rightmove and Zoopla) during Q3, 2022,
with demand based on the number of prime properties already sold subject to contract
or under offer as a percentage of total properties listed.

About the Author

Established in 1958, Benham and Reeves is one of London’s oldest, independently owned property lettings and sales agents. With specialism in residential sales, corporate lettings and property management in prime areas of London, the company operates from 19 prominently located branches and 11 international offices.

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