Recent changes to the UK’s non-domiciled (“non-dom”) tax rules have triggered a significant shift in the country’s high-end property market. As tax perks vanish, many wealthy international residents are choosing to leave—leaving behind prime real estate that’s now seeing price reductions and fewer bids.
💼 What Changed for Non-Doms?
As of April 2024, the UK government ended tax exemptions that allowed non-doms to avoid inheritance tax and pay lower tax rates on overseas income. In response:
- Over 10% of UK non-doms have already left the country in 2025.
- An estimated 16,500 millionaires may leave by year-end.
- Luxury stamp duty revenue dropped by £401 million compared to 2023.
Sources: Financial Times, The Times, Bloomberg.
📉 Impact on Prime Property Prices
High-end areas—especially in central London—are now experiencing:
- A surge of price reductions on £5M+ homes.
- Longer selling times and fewer overseas viewing requests.
- More listings remaining unsold during the peak spring season.
Estate agents are noting that sellers are increasingly willing to negotiate, and inventory is sitting longer on the market than usual.
🌍 Who’s Still Buying?
While many non-doms are exiting, some investor groups see opportunity:
- Buyers from the U.S. and Middle East are still active, encouraged by weaker GBP and softened prices.
- Some view this period as a rare chance to buy into London’s elite postcodes at a discount.
🔍 What This Means for Buyers
This shift may open the door for buyers who were previously priced out:
- Less competition in the luxury segment.
- Greater negotiation power on top-tier homes.
- Potential for strong long-term capital growth once the market stabilises.
It’s also a key moment for overseas buyers with cash or international financing options to enter the market strategically.
💡 For Estate Agents: Time to Shift Strategy
Agents handling high-end property must now pivot from speculative sellers and unfocused listings to:
- Targeting serious international investors.
- Setting realistic prices with sellers upfront.
- Using data-driven marketing to engage overseas clients.
This period of adjustment could present new revenue streams for agile agents who respond to market changes proactively.
❓ Frequently Asked Questions
- What is a non-dom?
- A non-dom (non-domiciled individual) is someone who lives in the UK but claims their permanent home is outside the country, which used to offer tax advantages.
- Why are non-doms leaving the UK?
- New tax laws have ended many financial benefits for non-doms, especially around inheritance tax and overseas income. As a result, many are relocating to more tax-friendly countries.
- Is this affecting house prices?
- Yes, particularly in the £2M+ and super-prime markets in London. Prices are softening due to lower demand and increased supply from non-dom sellers.
- Is now a good time to buy luxury property?
- If you have the budget and financing, it may be a strong moment to negotiate deals on high-end properties—especially in areas traditionally dominated by overseas buyers.
- Who is buying these properties now?
- High-net-worth buyers from the USA, Middle East, and even Asia are showing renewed interest due to price adjustments and currency advantages.
