London’s most expensive homes are having a tough time selling, with both demand and deals down. According to a new report from real estate company Knight Frank, there were 22% fewer sales above £10 million ($13.2 million) in the 12 months to July, compared with the same time period from 2022–23.

The picture is gloomier for the priciest properties: There were just 10 sales above £30 million, compared with 38 in the previous period. In total, super prime sales volume in London came in at £2.77 billion in the 12 months through July, down from £4.3 billion in the period ending in July 2023.

“Sentiment in prime central London is significantly down,” says buying agent Camilla Dell, founder of Black Brick. “The current market reminds me a little bit of the financial crisis in terms of what I’m seeing in terms of the volume of stock available, price reductions and nervousness in the market from vendors.”

Brokers chalk much of the market uncertainty to July’s election, which was well-flagged to be a shift in government during the proceeding year. The Labour party, which won a resounding victory, had been consistently polling higher than the Conservatives, who had been in power for over a decade. High interest rates also weighed on sentiment; the Bank of England delivered its first cut in four years just this August.

Uncertainty has now shifted onto the ramifications of the new government, specifically uncertainty surrounding a new tax regime, says Stuart Bailey, head of super prime sales London at Knight Frank. Tax hikes have been floated by the new Labour government, including possible increases to capital gains and inheritance taxes, which will be revealed in the upcoming UK budget, set for Oct. 30.

It’s also likely that the government will overhaul its system for the 74,000 individuals living in the UK who don’t pay tax on their non-UK income, known as “non-doms.” These include some of the world’s richest people and those who’ve reached the highest rungs of finance; more than 20% of the UK’s highest-earning bankers have been non-doms at some point, according to 2022 research. Famously, the wife of Rishi Sunak, Britain’s former prime minister, also claimed non-dom status.

The unanswered questions around higher tax regimes and plans to do away with preferential tax treatment for wealthy foreigners have been spooking rich buyers, brokers say.

“The budget is making people wait and see—so it doesn’t matter whether it it is good, bad or ugly. The point is that it’s uncertain, so people are hesitating now,” says Bailey. He adds that we’re at the low end of a 10-year downward cycle in pricing, and he’s seeing sellers reduce prices to get deals across the line.

The report says that properties in prime central London above £10 million are 14% below their peak in September 2015. That’s even more dramatic in dollars, where the decline is 25%, given the weakening of the pound since the Brexit vote in 2016. This is seen in the amount of American buyers coming into the London market, whose dollars go further than in the past.

“If you’re a buyer, and especially a cash buyer, it’s blatantly a good time to be buying right now at this low point, when there’s not too much competition with other buyers,” says Bailey of the current super prime market, which he characterizes as “frustrating,” especially at the top end. “But we’re just in a vacuum period of sitting on the fence with nothing happening until the budget.”