The price of an upmarket London home fell by more than 4pc in the last three months of 2014 as political uncertainty and stamp duty rises collided.
Central London homes priced around the £4m mark, deemed to be the threshold for luxury, were hit hardest by George Osborne's stamp duty overhaul, falling by 4.2pc in Q4 and 1.3pc over course of 2014, according to Savills.
New research from the international property group found that the adjustment of prices at the top end of the market, and the fear of a mansion tax, should Labour win the general election in May, also exerted downward pressure on family homes and flats priced above £2m, with a drop of 3.1pc in Q4.
Savills has forecast a 0.1pc drop across all the price brackets in "prime" central London in 2015 - defined as the top five to 10pc of the market.
"It will take time for the effect of the stamp duty changes on prices to become clear, early signs are that the additional cost is predominantly being borne by sellers through price adjustments at a level similar to the extra stamp duty," said Lucian Cook, head of UK residential research at Savills.
"Prices were easing before the Autumn Statement, so for the very top end of the market the stamp duty rise coincided with some of the froth coming off pricing earlier in the quarter," he continued.
The analysis also showed that even without the Chancellor's surprise stamp duty reform, announced in December's Autumn Statement, values were on track to soften by around 1pc in last quarter, in part due to "general pre-election uncertainty around high value property taxation."
Only this week Jim Murphy, the Scottish Labour leader, revealed that the controversial mansion tax on homes in England worth more than £2m would be used by Ed Miliband's party to pay for 1,000 nurses north of the border.
Researchers at Savills described 2014 as a year of two halves for the prime London residential market.
Prices rose by 4.9pc on average in the first half of the year after a surge of both domestic and foreign wealth into the capital's high-end housing market and a surge of pent-up demand following the downturn.
This triggered a wave of transactions across the capital as affluent Londoners living in the central boroughs sold up, cashed in on the spike in prices and upsized to bigger properties in the commuter belt or further afield.
This led to the upmarket property in the regions outperforming central London for the first time in a ten year cycle, said Savills.
The second half of the year saw a 2.2pc fall in this section of the market in central London, dragged down by political uncertainty ahead of the election, stamp duty reform and inflated prices.
London property has been has been a safe haven for global funds, with most recently a small surge in investment from Russians during the pre-Christmas rouble crisis.
While Middle East sovereign wealth funds continue to sink their riches into the capital's housing and infrastructure, economic woes in regions such as China and the eurozone, and the falling oil price, have fuelled concerns about the continued level of investment.
However, property prices in the £1m to £2m bracket increased by 2.5pc - largely unaffected by political uncertainty and stamp duty changes, Savills' research showed.