By Hugo Cox.
A new Financial Times feature examines how rising taxes, higher acquisition costs and changing government policies are reshaping the world’s leading luxury property markets, with London and New York both seeing a growing shift away from second-home ownership.
The article explores how increasing Stamp Duty Land Tax in the UK, alongside New York City’s new pied-à-terre tax, is prompting many international buyers to reconsider purchasing luxury homes. Rather than committing significant capital to buying, affluent individuals are increasingly opting to rent high-end properties, particularly when relocating temporarily for work, business or education.
This trend is becoming particularly evident in Prime Central London, where the combination of elevated purchase costs, changes to the UK’s non-dom tax regime and wider economic uncertainty has strengthened demand for luxury rental properties. Developers are also adapting by retaining more premium homes for long-term lettings instead of selling them outright.
Black Brick Property Solutions provides expert insight throughout the feature, highlighting how international buyers are making more financially strategic decisions.
Discussing why renting often makes more sense, Camilla Dell, Managing Partner at Black Brick commented, “If they’re on the innovator visa or the FIG regime, often the calculations favour renting for this period.”
Tom Kain, Partner at Black Brick also commented on the financial case for renting, “A typical £5mn London apartment rents for around £220,000 per year, meaning the £950,000 stamp duty payment a foreign buyer would need to pay on a second home at that price, would finance nearly four and a half years of rent.”
The article also highlights how this shift in buyer behaviour is influencing London’s luxury residential market. As demand for premium rental homes continues to grow, developers are increasingly retaining new-build apartments for the rental sector, reflecting changing priorities among international clients.
To read the article, please click here.