London mansion sales collapse as non-doms flee Britain
Transactions involving London homes worth more than $10m (£7.5m) plummeted by 37pc year-on-year in the first three months of 2025, according to Knight Frank. The value of deals also dropped by 30pc to £592m.
Separate data from LonRes showed a 15pc drop in sales of properties worth £5m or more. However, there was a 22pc leap in these homes being put on the market.
Knight Frank blamed the slump on London's 'adverse taxation shifts'. It comes after Rachel Reeves scrapped non-dom status and began charging 40pc inheritance tax on global assets. Taxes on private schools fees have also increased.
The changes have prompted many wealthy people to move out of Britain to escape the charges. Ms Reeves is now considering reversing her inheritance tax changes in an effort to stem the exodus.
Liam Bailey, of Knight Frank, said: 'London has definitely been hit by much greater uncertainty around wealth taxation. The super-prime market hasn't stopped, but it is a lot tougher than it was.'
He said non-doms were 'not the majority of buyers in this market segment', but there 'has been a degree of contagion through weaker sentiment'.
Mr Bailey said: 'The key issue for the market is that the UK is just lacking a coherent narrative around where it wants to go in terms of attracting very mobile global wealth.
'London has massive strengths and attractions for this group – but if it is thought that it is good to have wealthy people in your country, it looks like we need a stronger plan from the Government to attract them. The competition from Italy, Dubai, the US and beyond is getting tougher.'
Sales of properties worth $10m or more rose by 5.7pc in Dubai over the first three months of the year according to Knight Frank. The estate agency said its 'low tax environment continues to draw global capital'. Other global hotspots include New York and Palm Beach in south Florida.
A lack of buyers in London is forcing wealthy sellers to offer steep discounts. LonRes said there were 45pc more discounts to mansion asking prices than there were last year.
Magda Wierzycka, the millionaire founder of UK venture capital fund Braavos, described her struggle to offload a property in Kensington to The Telegraph on Wednesday. She said: 'I put my flat in Kensington on the market five months ago, but because so many like me are leaving there are hardly any buyers.'
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