Over the past two decades, London’s high-end property market was overrun by the global superrich led by Russian oligarchs who did so many big, brash deals that locals called the city Londongrad.

A mansion just a stone’s throw from Kensington Palace—on land leased from the crown—sold for $140 million to one oligarch, while estates built by Victorian aristocracy and industrialists traded to Russia’s new rich, who added sprawling subterranean pools and sleek glass walls

Now the U.K. government has all but told rich Russians they are no longer welcome. The move  could hit the top slice of the real-estate market, which is already on edge due to war in Europe and a selloff in stocks.

The government has introduced a raft of measures targeting the Russian elite. It has frozen all assets tied to multiple Russian oligarchs with mansions in the city, while some lawmakers have called for the government to seize and sell those homes. It shut down a visa program that gave wealthy foreigners a quick path to citizenship, and is introducing rules that make it harder for property buyers to stay anonymous, a feature that had been an attraction of London.

A bigger risk for London’s high-end property market is the broad aversion to transacting with Russian money that is sweeping Western finance. Businesses in industries from energy to accounting have already gone beyond government sanctions and shut down Russian companies or cut off clients. If banks, brokers or sellers stop dealing with Russians—either to send a message about the war or to avoid getting caught in future sanctions—it could further cut the flow.

Mark Pollack, co-founder of high-end property brokerage Ashton Chase, said one sale his company was working on with a Russian buyer recently fell apart and he is aware of at least two other deals with Russians that collapsed due to the Ukrainian invasion.

At the start of the year, he said, the buyer “seemed really kind of committed and happy to proceed,” until abruptly pulling out of a purchase.

“There’s definitely a pause,” in the overall market thanks to the war, Mr. Pollack said. Buyers and sellers are full of “uncertainty as to what the future does or doesn’t hold.”

Sanctions are beginning to show their effects in other ways. On Friday, a court froze the bank accounts held by property manager Graham Bonham-Carter after the U.K.’s National Crime Agency said that they were being used to help Russian raw materials tycoon Oleg Deripaska avoid sanctions, according to an NCA spokesman. Mr. Deripaska, who is on the U.S. sanctions list, has fought that designation in federal court. Mr. Bonham-Carter said he is going through a very difficult time and couldn’t comment on the account freezing.

The super-prime property market in London soared in the past two decades as the global superrich stashed their cash in high-end properties deemed to be safe bets in a stable country. Russians were never an enormous chunk of the market—they were typically estimated to be less than 10% of the high end—but they became a symbol of the rush of global wealth into the city from China, the Middle East and countries including Ukraine.

Prices for high-end homes and penthouses shot to previously unimaginable levels, while local brokerages staffed up with Russian speakers.

Roman Abramovich, who made his fortune running an energy company, bought a 15-bedroom home on land leased from the British crown in 2011 for around $140 million. The property was once owned by an English baron who was an arms manufacturer, and later became part of the Soviet embassy. In 2016, Mr. Abramovich embarked on an extensive renovation that replaced a large swimming pool underneath the property’s garden, although local officials rejected his call for a treehouse.

Mikhail Fridman, one of Russia’s richest men as a founder of conglomerate Alfa Group, paid around $100 million in 2016 for a derelict, 35,000-square-foot Victorian mansion on the edge of Hampstead Heath, a sprawling park in north London. He restored a garden by design legend Gertrude Jekyll, winning over his neighbors who supported his local planning application to relocate some protected grassland on a lawn. Mr. Fridman was recently hit with sanctions by the European Union but said he will contest the designation.

Transparency International, an advocacy group founded by former World Bank officials, says around $9 billion has been invested in U.K. property since 2016 from suspect sources, and that Russians allegedly tied to the Putin regime or corruption have spent at least $2 billion.

Real-estate agents became accustomed to cash purchases of multimillion-dollar homes by wives, children and associates through shell companies in Cyprus and the British Virgin Islands. The program that granted U.K. visas in exchange for property investment welcomed more than 2,000 wealthy Russians to the country since 2008. The U.K. tightened the program after Russia allegedly poisoned a former spy living in England in 2018, and ended it in February.

This week, Prime Minister Boris Johnson speeded up legislation for a new register recording homeowners by name and said more oligarchs will join the sanctions list. Mr. Abramovich, who isn’t on any sanctions list, has said he would sell his soccer club Chelsea FC.

Others are feeling the sting of sanctions and frozen accounts. Mr. Fridman resigned from his Luxembourg-based investment firm, which froze his minority stake. A neighbor near his Hampstead estate, Alisher Usmanov, is on the British and EU sanctions list and owns a 16th century property south of London in Surrey that once belonged to petroleum tycoon J. Paul Getty.

The sanctions will make any sales near-impossible in the short term, but even managing these massive properties will be difficult.

Michael O’Kane, senior partner at law firm Peters & Peters said the asset freezes prevent sales, or even servicing properties. Paying an emergency plumber to fix a leaking pipe means getting a license from the U.K. sanctions office, he said.

“You can have a £15 million house in Hampstead and you can’t pay to cut the grass or sweep the drive or clean the windows,” Mr. O’Kane said.