Can Bayswater level up with the rest of prime central London?
By Liz Rowlinson
The first stages of the £3bn redevelopment of Queensway are bedding in. More change is on the way. But there’s still some distance to go to shake off the “cheap side of the park” jibes. Buyers are enjoying a different view of Bayswater, as luxury developments such as Park Modern transform the landscape. Can Bayswater level up with the rest of prime central London?
Just north of London’s Hyde Park on Queensway, the main commercial artery of Bayswater, The Whiteley is one of the capital’s most talked-about ultra-luxury apartment schemes. Behind the creamy-white art deco Portland stone facade of what was once London’s oldest department store, are 139 new apartments, a Six Senses hotel, plus shops, restaurants, an Everyman cinema and upscale Third Space gym. Yet, across the street from the Foster + Partners redesigned building (where a penthouse is selling for £39.5mn), it’s a different matter. A block of cheap souvenir shops, discount stores and fast-food joints buzzes about its business. A boarded-up shop reads “Queensway is changing”. After June these will be razed to make way for high-end shops and pavement cafés. But will the £3bn regeneration of the street with Parisian-style glass dining pavilions, help the “cheap side of the Park”, as it is known, level up with the rest of prime central London?
Despite all the elegant Victorian white stucco terraces, pretty garden squares and many a photogenic mews, the neighbourhood between Notting Hill and Marble Arch has, for several generations, been the grittier, under-the-radar sibling in the area — a sort of lost hinterland. Bayswater’s renaissance has been driven by developments such as The Whiteley, a luxury conversion of the former department store into apartments starting at £1.5mn. It was not always so.
When its genteel crescents and squares were built in the 1850s it was a quietly affluent area, where William Whiteley decided to build a drapery shop on Westbourne Grove that became the new Whiteleys store (with royal warrant) in 1911. The area’s desirability continued when Selfridges bought and extended the store in 1927; it also became known for its affluent multiculturalism with its Greek, Jewish and Middle Eastern communities.
But since the 1980s it has drifted downmarket. Bayswater (W2) became the area “where you can get spacious period flats and mansion blocks at a discount for prime central London” says Moreas Madani of Tyburn Property Consultancy. The average flat sold for £1,229 per sq ft last year — considerably less than the prime London average of £1,577, according to LonRes, which tracks the prime market.
But as the wider prime central London market struggles with the effects of Brexit, stamp duty increases, higher mortgage rates and inflation, Bayswater has stayed stable. The average price per sq ft of a sold property fell just 0.1 per cent between 2023 and 2024, while transaction levels were up 9 per cent. The respective averages across prime central London were down 5.6 per cent and up 5 per cent. Average time on the market of 285 days (around nine months) is consistent across both. The drive to regenerate Bayswater has not robbed it of its many quintessentially Victorian properties and businesses.
A new, younger demographic is now seeing the area’s comparative value as “less a compromise and more an opportunity”, says Madani. The smartening up of the area around Paddington Station, used by the Heathrow Express and more recently Crossrail, has already moved the dial.
Daven Chopra who works in finance is about to exchange on a one-bedroom flat in a stucco terrace near Queensway, after living in Maida Vale, an affluent area 1.5 miles north. “I use Heathrow every week and being so close to Paddington was also a big draw — and I am at my Hanover Square office on the Elizabeth Line in around 10 minutes. While some of the incredible buildings in Bayswater are [currently] rundown bedsits or guesthouses, I am confident this will change.”
The opening of Crossrail was also a plus for Jacinta Goulter who bought a one-bed flat in the area after moving from Queens Park, another affluent but less central area. “Being next to the Park has to be a good investment,” she says. She cites a new outpost of pilates brand FORM on Queensway, and Jeremy King’s new restaurant The Park as early signs of positive change. The American-style restaurant is on the ground floor of Park Modern, a super-prime development by Fenton Whelan at the Park end of Queensway, which will bookend a swath of new development running down from The Whiteley. Developments such as Park Modern are driving change.
At 28-34 Queensway, 30 apartments will be completed in early 2026. The company has also acquired the long block opposite The Whiteley which was formerly slated to become The William; it is applying for new planning consent for a seven-storey, Portland stone apartment building with shops and cafés, which will also be given a new name and identity. “We wanted to be part of the transformation of Queensway but are glad The Whiteley got the ball rolling,” says Vabel co-founder Daniel Baliti. “You look at how Notting Hill changed, and then Fitzrovia, then Marylebone and this is next.” He says they are looking to bring in brands and a private members club that are fun, fresh and modern — “less stuffy than Belgravia”.
The Whiteley has been one of Savills’ best-performing new schemes, according to Edward Lewis, head of London residential development for the company, who says that its average £3,600 per sq ft is less than new prime developments in Marylebone (£4,000), and the area including Mayfair, Knightsbridge and Belgravia (£5,000-£6,000). The building has 38 apartments left to sell (from £1.5mn).
Alex Winship The Queensway Steering Group of landowners (including The Whiteley and Fenton Whelan) is overseeing the area’s redevelopment. As well as introducing more street cleaning and security, they are also planning new paving and planting that will lead down to new ornate public gates into Hyde Park. There will also be upgrades to Queensway and Bayswater Underground stations.
A £3mn refurbishment was recently completed at Porchester Spa — London’s joint oldest with York Hall, both opened in 1929. Smaller developers are feeling the ripple effect of the Queensway regeneration. “Right now, Bayswater feels like an easier place to sell a property than Maida Vale,” says Ben Wilson of Knight James, which buy homes to renovate and sell on.
Current projects are in Westbourne Terrace — a wide, tree-lined street of stucco terraces near Paddington — and Gloucester Terrace. “I see Bayswater catching up with Notting Hill in 10 years.” Some people like the idea that W2 is not full of Instagramming tourists asking for directions to Portobello Road Market Charles Irwin, Winkworth Madani of Tyburn Property has not yet seen a rush of buyers reappraising those stucco houses: “The effect so far has been more psychological than transactional.”
Camilla Dell of Black Brick Property Solutions agrees: “I think the area will level up but it will take a while. At the moment it’s a bit of a hard sell. You are still buying with the hope factor.”
Long-term residents are also hopeful, says Scott Joseph of estate agent Anderson Rose. “Since The Whiteley I have had calls from owners in nearby mansion blocks assuming they can sell their flats for double what they are worth — which is actually around £1,000 to £1,300 per sq ft.” The LonRes data would suggest that what Joseph calls a “slim increase in value” is nearer the reality. But even those houses in Bayswater’s most desirable pockets, and which achieve a £1,500 per sq ft price tag, are still at least 25 per cent cheaper than similar properties in Notting Hill, says Charles Irwin of Winkworth, who points to the “lovely little enclave” of Sunderland Terrace, Alexander Street, Durham Terrace and Westbourne Gardens. He has just sold a six-bedroom house in Bayswater, off-market, for £6.35mn that he estimates would be £10mn in prime Notting Hill. He adds: “Some people like the idea that W2 is not full of Instagramming tourists asking for directions to Portobello Road Market.”
Popular private prep schools such as Wetherby, Chepstow House and Pembridge Hall are close by so the large properties of the W2 area are a draw for families. “I can see houses in Bayswater [rising in value] more quickly than flats,” says Irwin. LonRes figures bear this out: the average house in W2 is up 5.6 per cent last year on the pre-pandemic average — more than the 3.5 per cent average of prime central London.
The border between Notting Hill and Bayswater is becoming more blurred in people’s minds, believes Arthur Lintell of Knight Frank’s Notting Hill office, referring to the streets west of Queensway — around Leinster Square, Hereford Road and Ossington Street. “Younger, wealthier buyers, including a number of Americans, want proximity to both Notting Hill and Queensway.” A four-bedroom flat on Cleveland Square, currently under offer through Savills, at £3.25mn Americans have been the biggest group of foreign buyers at The Whiteley, says Charles Leigh, sales director at the scheme. There have also been a number of British downsizers from Notting Hill. “We’ve seen people moving here from a four-storey townhouse within a mile of The Whiteley.” Yet the buzz about the project has had little impact on the area’s rentals market so far. “Until everything’s up and running [on Queensway], I don’t see demand and rates increasing,” says Tanya Hasking, head of lettings at John D Wood. “We are quite some time off that.”
Andrew Norris who has bought a one-bedroom flat on Queensway, opposite Starbucks, is happy to play the long game. “If in time I need a bigger place, I know it will be a great rental investment,” says the surveyor, who moved from Balham, south London. “I bought when it was undervalued but I can see that changing.” Some fear that the changes on Queensway may result in the area losing its distinct appeal and become just another slickly curated high street. But recent buyers such as Chopra feel that a new distinction is needed. “I don’t think there is anything to lose. I hope it becomes like Westbourne Grove — my favourite street in London.”
The playing field has changed substantially’ for property buyers, says one of London’s top buying agents, as she explores why Trump’s tariff-induced international economic turbulence feels different to previous financial crises.
Global financial markets have been on a wild ride in recent weeks, reacting to rapid changes to international trade dynamics as President Trump toys with the America’s tariff regime.
Prime London property is often touted as a “safe haven” in times of economic volatility, but are things different this time around?
Top-flight buying agent Camilla Dell, founder of Black Brick, has been musing on how the current turbulence compares with previous bouts of economic mania – such as the Global Financial Crisis of 2008.
“In 2008–2009, we saw a clear flight to safety,” says Dell. “At the height of the global banking meltdown, with names like Lehman Brothers, Bear Stearns, and AIG dominating headlines. Many of our clients turned to London property as a tangible, stable alternative to volatile stocks and bonds. Activity surged, driven both by opportunists and those seeking the security of bricks and mortar.”
This is not the case today, suggests Dell. “We don’t anticipate a sudden rush of overseas buyers flooding the market, despite the current financial volatility,” she says – although her buying agency is seeing “notable momentum from UK domestic buyers those upsizing, downsizing, or purchasing second homes.”
There are several reasons for the altered market landscape. Notably, prime property prices have largely stagnated over a ten-year timeframe. Prices have retreated back to where they were during the last financial crisis, quelled by changes in non-dom taxation and increased stamp duty – which means some PCL homes are now looking like relatively good value.
“For buyers who’ve been waiting patiently on the sidelines,” Dell believes “the tide has turned in their favour.”
Another “stark contrast” to the 2008 era is that foreign buyers can no longer purchase through offshore corporate structures to avoid inheritance or capital gains tax. “The playing field has changed substantially, limiting some of the fiscal benefits that once drew international capital to London,” notes Dell.
2008 Vs 2025: 3 key differences for the UK property market (according to Black Brick)
Stamp Duty Dynamics: During the 2008 crisis, the highest stamp duty rate was just 4%, and the government raised the 0% threshold to stimulate transactions. Today, overseas buyers of additional properties may face rates as high as 19%.
Interest Rate Environment: Following the collapse of Lehman Brothers, the Bank of England rapidly reduced base rates from 4.5% to 2% within months. Today, despite speculation of future cuts, the base rate sits at 4.5%, and dramatic reductions appear unlikely.
Change in Tax Incentives: The removal of historic tax advantages for buy-to-let investors has largely reduced the appeal of property as a yield-focused investment.
Camilla Dell: “People are understandably nervous right now. In times of financial fear, many pause, especially those who have suffered losses in the markets. But for the brave, there are real opportunities. One of our overseas clients, currently transacting, put it perfectly: ‘Buying a place in this turmoil seems crazy, but that’s why I think offering something like this makes sense. No one is transacting on anything anywhere.’
“As the global financial picture continues to evolve, the message is clear: London may be down—but for the right buyers, it’s far from out.”
The US president has caused stock market turmoil. Why buyers and borrowers could be in for a wild ride
By Hugh Graham, David Byers and Carol Lewis
Just as everything seemed to be settling down after the rush to beat last week’s stamp duty tax hike, tariff turmoil has hit.
Twenty-four hours after the stamp duty deadline on April 1, President Trump declared “liberation day”, launching a global trade war that has led to stock market meltdown, initially pummelling the value of investments and pensions and unleashing uncertainty across the world.
Then, the president U-turned, telling reporters at the White House that people were “getting a little bit yippy”, and announced a 90-day pause in the higher rate of “reciprocal tariffs”. The FTSE 100 and 250 recovered to more than 8,000 points yesterday morning, in the biggest rally in more than five years.
However, given the president’s propensity to make seemingly contradictory announcements at a whim that can change the prospects of global economies, what is clear is that we have entered a period of unprecedented unpredictability which makes it near-impossible for people to plan what to do when making big decisions with their money. What does this mean for those hoping to buy or sell property, or take out a mortgage?
Is it 2008 all over again?
Whenever there is significant stock market uncertainty, some analysts look back with trauma at the 2008 financial crisis, which triggered job losses, left homeowners with easy-come mortgages sliding into negative equity, repossessions soaring and house prices dropping by about 20 per cent.
However, don’t panic. As the consequences of the autumn 2022 mortgage rate spiral showed, homeowners today have been far more extensively stress-tested than before the 2008 financial crisis, which means repossessions have stayed extremely low — and will continue to do so, even if further unpredictability sends markets into a fresh tailspin.
Matthew Swannell, the chief economic adviser to the EY Item Club, a leading economic forecasting group, says: “A careful and measured approach should be taken when comparing the UK’s current economic circumstances with the global financial crisis, when UK GDP fell by more than 6 per cent and the unemployment rate increased to about 8 per cent.
“The global financial crisis led to a significantly deeper downturn than even the Office for Budget Responsibility’s most pessimistic tariff scenario, where GDP is estimated to fall by just over 1 per cent.”
What about the super-rich?
Camilla Dell, who founded her property consultancy Black Brick in 2007, just before the financial crisis, says the luxury end of London’s property was already a buyer’s market, even before Trump. High tax is putting off purchasers — stamp duty can be as high as 19 per cent for overseas buyers compared with 4 per cent in 2008 — with tax advantages to invest in buy-to-let gone and the non-dom regime abolished.
So, this turmoil is the latest in a series of causes of a market slowdown, rather than the primary trigger. “The result of stamp duty increases and non-dom tax changes have caused prices in London to decrease to levels not seen since the financial crisis,” she says.
Helen Whitfield, whose Butler Sherborn agency deals with high-end homes in the Cotswolds, says: “The conversations I’ve had with people who are buying at the moment, some of them are like, ‘I’ve just had £400,000 wiped off the value of my stocks and shares.’” However, up until this week she says the market had been going well with her phone “ringing off the hook” and she believes it will again, particularly as most of her buyers don’t need mortgages. “The Cotswolds isn’t dying on its feet yet,” she adds.
What about the rest of us?
For most of the market, though, uncertainty abounds. And when there is uncertainty over people’s finances and their investments, there is likely to be a slowdown, particularly among middle-class movers. For sellers, this means being realistic on pricing, while buyers are likely to negotiate more robustly.
The latest monthly survey of property professionals by the Royal Institution of Chartered Surveyors (Rics), covering March, found the weakest buyer sentiment since September 2023.
It said “three-month sales expectations point to a further dip in activity over the near term, but further ahead the outlook is not quite as downbeat with sales volumes expected to rise.”
Simon Rubinsohn, Rics chief economist, says: “The expiry of the stamp duty break was always going to lead to a pause in activity in the sales market. However, the latest results, and indeed the anecdotal remarks from respondents to our survey, suggest that the shift in sentiment has been aggravated by the slew of negative macro newsflow over the past few weeks.
“Looking forward, the impact on the market will in no small part depend on how the economy is affected by the emerging trade war and the response of the Bank of England to the shifting environment.”
Ashley Webb, a UK economist for Capital Economics, agrees the market may be more muted as buyers worry about their investments — given the propensity for the markets to dip, soar and dip again. “The fallout in financial markets could reduce households’ net wealth via pensions and investments, which in turn could weigh on consumer confidence.”
He notes that housing demand has always risen and fallen in line with households’ confidence. Capital Economics, however, has not yet adjusted its market forecast — predicting a 3.5 per cent rise in property prices in 2025 and 4.5 per cent next year.
Lucian Cook, the director of residential research for Savills, says: “Further economic uncertainty is likely to mean the continuation of a price-sensitive market through the spring, with activity dominated by needs-based buyers and sellers.”
Savills’ forecast, released after the spring statement, predicted transactions remaining slightly below their pre-pandemic average over the next five years, peaking at 1,150,000 in 2028 (there were 1,040,000 transactions last year). This may be further hit.
For those buying more affordable properties outside London and the south, the market is likely to be stronger than for those stretching themselves for pricier homes. Data published by Halifax on Monday showed a 6.6 per cent annual price growth to the end of March in Northern Ireland, where the average property price of £206,620 has scarcely recovered from its level during the financial crisis. Scotland (4.3 per cent) and Yorkshire and the Humber (4.2 per cent) come next, but pricier Greater London was registering an anaemic 1.1 per cent in property price growth.
Is property still a safe investment?
Timothy Hawe, the director of the Your Move estate agency in the Newcastle area, says the average value of properties across its 13 branches is £180,000 — and suggests sentiment in this market is strong, particularly because the rise in stamp duty didn’t affect this price point. “We’re not seeing people pulling out of deals or getting really nervous. The other reaction we’re getting is: aren’t bricks and mortar great? Property doesn’t have that massive fluctuation — people see it as a safe investment.”
Nathan Emerson, the chief executive of Propertymark, the membership body for the property sector, says: “Perversely [market disruption] creates an incentive for investing in property. Investing in property is for the long term. Buy-to-let isn’t as profitable as it once was, but there is a shortage of stock and oversupply of tenants and it’s a lot less volatile than the markets are.”
Is there good news for borrowers?
One reason for confidence is to be found in the mortgage market, with the possibility that borrowers may actually yield some benefit out of the world’s economy going into a tailspin.
About 1.34 million homeowners are due to come off expiring fixed-rate deals between April and December, according to the Financial Conduct Authority. Of these, up to 750,000 will be coming off super-cheap five-year fixes which they took out during the 2020 Covid era, which was set to leave them with a massive payment shock when they negotiated new deals.
However, there is now a suggestion that the Bank of England will need to cut interest rates faster than expected to stave off an economic downturn — a move which could lead lenders to cut rates.
Experts generally agree that the outlook for mortgages — while uncertain — looks slightly improved in light of this, at least in the short term.
Webb says: “The markets have concluded that interest rates will fall a bit faster than they previously thought. At face value, that implies the two-year mortgage rate will fall from 4.5 per cent in March to about 4.25 per cent.”
Chris Sykes, a broker at Private Finance, also sees reason for optimism on rates, even though the situation is “rather confused and up in the air”.
He adds: “Interest rate futures currently price in about an 85 basis point reduction this year according to Reuters, with Trump’s tariffs being the leading cause for changes in this over the past week.”
Although rates may get lower faster, this doesn’t necessarily mean everyone will be able to afford the cheaper rates.
While some lenders could follow the example of Santander in relaxing stress-testing, others are likely to be more cautious, given the uncertainty which affects their balance sheets. Martin Stewart, of the broker London Money, says: “If bank shares are hit hard — and they have been — it can have an effect on their capital adequacy ratio, which in turn leaves them having to ring-fence money to improve financial stability and absorb potential losses — money that they can’t then lend to the consumer.”
There’s also a counter-argument that the tariffs are likely to stoke inflation by making prices of goods more expensive, and so the Bank of England ought not to cut rates at all. Andrew Sentance, a former Monetary Policy Committee member, takes this view. “I expect UK inflation to go above 5 per cent this autumn and stay at around this level into next year.”
Emerson agrees: “In the short term we could see interest rate cuts but in the longer term there is an inflationary risk to the market, so rates could adjust again.”
Although, he adds: “There is nothing to suggest there will be a housing crash. We might see a little negotiation over stamp duty after the deadline but the fundamentals of the housing market remain. We have a supply shortage.”
What about first-time buyers?
For first-time buyers, the chance to pick up a bargain from modestly falling prices may provide a hint of optimism — even if increased stamp duty has raised the bills of buyers in the southeast and London (from £2,752 to £9,002, on average).
In the run-up to the stamp duty deadline, first-time buyers were over-represented in the market — purchasing a record 32 per cent of all homes in the first quarter of this year, up from 30 per cent a year earlier, a record high.
Those whose Lifetime Isa accounts are invested in the stock market may have seen their portfolio shrink significantly over the past week, setting back their hopes of affording a home.
Plus, given that the so-called Bank of Mum and Dad helped first-time buyers with £9.3 billion in 2024 — assisting 54 per cent of those buying homes — there are question marks over whether those whose investments have been hit will be able to afford it this time.
Will Labour’s building plans be hit?
There are also questions over whether inflation may hit the government’s ability to build the homes it has promised. “We will need to watch the impact on building material costs around the world. Costs are already at an all-time high and we’re already about half a billion bricks short of what we need. This could affect the government’s ability to hit its building targets. If building material costs do rise further it will be challenging to be affordable housing goals,” Emerson says.
Our panel of luxury property leaders urges the Chancellor to ease the tax burden on residential transactions, and to make Britain a more hospitable place for international investors & HNWIs.
Chancellor Rachel Reeves is due to present the annual Spring Forecast and economic statement later this week (on 26th March). This is not supposed to be a full “fiscal event” like the Autumn Budget, but Treasury sources recently warned that “the world has changed” in the last six months – implying the Spring Statement may be more than an economic sit-rep. Tax changes and policy shifts are very possible.
So we asked leaders in the prime property sector what they most hope Reeves will announce on the 26th, and what they most fear will come to pass:
What measures could the Chancellor announce in a Spring Forecast Statement that would bolster the property market?
Which policies could (or already are) doing most damage to the high-value residential property sector?
Our panel – which includes estate agents, buying agents, developers, designers and mortgage brokers – is not optimistic. Given the bleak wider economic landscape, not-great news on the geopolitical front, warning noises about public sector over-spending, and a left-leaning government – the likelihood of any announcement in favour of luxury homes is slim.
As is now tradition, Stamp Duty reform tops many property pros’ wishlists. Simon Barry of Harrods Estates says “the current regime creates an artificial market where both buyers and sellers are penalised for wanting to move or invest.” Buying agency boss Camilla Dell argues changes to the SDLT regime since 2014 have been “like pouring glue into the London property market”, and advocates for a return to the pre-George Osborne “slab” structure.
Stamp Duty cuts are unlikely, admits Robin Edwards of Curetons, but “even the hint of an easing or targeted relief for specific groups, such as first-time buyers and downsizers, could inject some much-needed momentum into the market.”
Other key concerns include ongoing fallout from the abolition of Non-Dom tax breaks, “unintended consequences” of the Renters’ Rights Bill, and the possibility of hikes to Capital Gains Tax or even the introduction of a new mansion tax or wealth tax targeting the super-rich.
More positive notes focus on the potential for effective reform of Council Tax – balancing the levy so more affluent areas and higher-value homes pay a fairer share, and the potential to remove or reduce VAT on some construction and home renovations – which Harrods’ Barry argues would be “a game-changer” for the property market.
There’s also an underlying cheerfulness about the relative stability of the current UK government, at least when compared to all the goings-on of recent years.
Overall, prime resi movers and shakers would like to see lower taxes and more encouragement for – rather than deterrents to – inward international investment. Becky Fatemi of Sotheby’s International Realty UK sums up the mood: “The worst thing Reeves could do right now is double down on punitive taxes that push wealth out of London”.
Talking Heads: Luxury property leaders’ Spring Budget wishes & fears
Revert to the pre-2014 slab system of Stamp Duty
– Camilla Dell, Managing Director at Black Brick
“Unfortunately, our ‘wish list’ for what we think should happen to the property market is unlikely to be fulfilled, but if we had a magic wand…
Stamp Duty: By far the biggest cost that a buyer incurs. When George Osbourne changed Stamp Duty rates in 2014, he changed the market forever. Those changes and indeed subsequent changes have been like pouring glue into the London property market. Transactions are fewer and people have no incentive to move. I would reverse Osbourne’s changes and revert to the old slab system with a top rate of 7% (and 3% extra for overseas buyers or second homes).
Reform Council Tax: Considering the above, I would then change the way council tax is charged, ensuring more affluent areas and expensive homes pay more and that these funds can be used to help fund wider public services in the borough.
Renters Reform: again, something that is being brought in, without any thought of unintended consequences. Landlords now have no security of tenure, with tenants being able to serve notice at any time which may push even more Landlords to sell, and reduce rental supply further, thereby harming the very people the government is trying to protect.
“Along with stamp duty, changes to the UK Res Non-Dom tax regime are by far the most harmful to the Prime Central London property market. We have taken calls from several clients all selling up due to Non Dom changes as they do not wish their entire estate to be drawn into UK IHT. A much smarter move would have been to keep the regime intact and instead charge a much bigger annual fee for Non Dom’s to retain their tax status.”
If the property market comes out of the Spring Statement relatively unscathed, demand should build over the year as buyers adapt to the new lending landscape
– Tom Bill, head of UK residential research at Knight Frank
“The government wants to boost tax revenue and encourage economic growth but its new rules for non doms risk doing neither. A tweak to the legislation around inheritance tax and overseas trusts would notably lower the number of foreign investors leaving the UK, but political ideology has so far trumped economic pragmatism. The government has also not been swayed by arguments in favour of an Italian-style flat tax to make the UK more competitive on the international stage.
“The inflationary impact of policies like higher employer national insurance contributions and minimum wage rises is a risk for the UK housing market. If inflation stays higher for longer, that will keep upwards pressure on mortgage rates. However, if the property market comes out of the Spring Statement relatively unscathed, demand should build over the year as buyers adapt to the new lending landscape.”
The worst thing Reeves could do right now is double down on punitive taxes that push wealth out of London
Becky Fatemi, Executive Partner at Sotheby’s International Realty UK
Wish: “London has lost too many of its UHNW residents, and it’s time to bring them back. The Spring Budget needs to send a clear message: London is open for business again. We should be rolling out the red carpet with policies that make it worth staying – like a more competitive non-dom tax regime, a longer tax exemption period for new arrivals, or incentives that encourage investment in UK businesses rather than pushing money offshore. The wealthy have choices, and right now, they’re choosing Dubai, Monaco, or Italy. If we want London to remain the world’s capital of opportunity, we need to stop pushing people away and start making them feel welcome again.”
Nightmare: “The worst thing Reeves could do right now is double down on punitive taxes that push wealth out of London. The city thrives because it attracts visionaries – entrepreneurs, investors, creatives—people who drive innovation and fuel our economy. If the Spring Budget brings more tax hikes – like higher Capital Gains Tax, an extended wealth tax, or even harsher inheritance tax rules on UK property – those people will simply take their wealth elsewhere. We’ve already seen international buyers turn away due to increased stamp duty and the non-dom crackdown. If the government keeps making London an expensive place to succeed, we risk turning it into a playground for tourists rather than a global hub for wealth, business, and culture.”
Adjustments to Stamp Duty could significantly enhance market fluidity, especially at the higher end
– Craig Tonkin, Regional Sales Director at Hamptons London
“As we approach the Spring Forecast, the property market, particularly in Prime Central London, is poised for potential shifts. While we hope for measures that could invigorate the sector, there are also concerns about policies that might dampen growth.
“In terms of hopes, it would be fantastic to think there might be some sort of stamp duty reform as adjustments here could significantly enhance market fluidity, especially at the higher end, by reducing barriers for both domestic and international buyers. We’re also keen to see a clear, long-term tax strategy that avoids sudden policy changes, providing the stability that investors and homeowners crave.
“However, there are apprehensions too. Any increase in Capital Gains Tax on property sales could stifle transactions and discourage investment, potentially deterring international clients from the London market. Similarly, the introduction of a mansion tax or further restrictions on non-dom buyers could push high-net-worth individuals to seek opportunities elsewhere, slowing the prime market considerably.
“Ultimately, while the Chancellor’s announcements are crucial, the most significant boost to the market in the short term would likely come from a reduction in interest rates. This, of course, falls outside the scope of the budget but remains a key factor in market dynamics.”
Zero-rated VAT on building work and refurbishments for second-hand homes would be a game-changer for the property market
– Simon Barry, Head of New Developments at Harrods Estates
Wish: “Our biggest wish would be for Reeves to reduce SDLT to a level which reflects the reality of property values in London and the South East. The current regime creates an artificial market where both buyers and sellers are penalised for wanting to move or invest.
“In addition, zero-rated VAT on building work and refurbishments for second-hand homes would be a game-changer for the property market. It would encourage investment in existing housing stock, driving sales, revitalising older properties, and embedding sustainability into the industry in a truly meaningful way. Instead of demolishing and rebuilding, homeowners and developers would be incentivised to restore, enhance, and future-proof Britain’s homes – delivering both economic and environmental benefits.”
Nightmare: “Conversely, an increase in Capital Gains Tax (CGT) on second homes and investment properties would risk stifling market activity. Faced with higher tax burdens, many sellers would simply hold onto their properties, further restricting supply and pushing prices even higher. At a time when we need to encourage greater fluidity in the market, additional CGT increases could have the opposite effect, limiting opportunities for buyers and reducing overall transaction levels.”
A change to Stamp Duty for downsizers would get the entire market moving
– Nina Harrison, London Specialist at Haringtons UK
Wish: “My biggest ask would be for Reeves to slash Stamp Duty for downsizers. There are thousands of older homeowners rattling around in houses far too big for them, desperate to move but trapped by eye-watering tax bills. Free them up, and suddenly, family homes start flowing through the market again. Chains speed up, sales rise, and the Treasury still rakes in tax from all the extra transactions. A change to Stamp Duty for downsizers would get the entire market moving.”
Nightmare: “The nightmare would be making it even harder and more expensive to employ people. Businesses are already drowning in costs, and every new tax or regulation just pushes them closer to the edge. If Reeves really wants a thriving economy, she needs to let businesses breathe. Cut the red tape, lower employment costs, and encourage growth. The rise in NI for employers was a mistake – many would welcome a U-turn.”
Rather than deterring foreign buyers, we should be encouraging them
– George Nares, co-founder of Blue Book Agency
Wish: “At the top of my wish list is a substantial reduction in Capital Gains Tax – ideally to 5-10%. This relatively new tax ultimately deters transactions, discouraging people from selling assets, including property. Lowering it would incentivise sales rather than stagnation, stimulating far greater economic activity and, ironically, generating more tax revenue than repeated hikes ever could.
“A reduction in Stamp Duty would also be welcomed. Successive increases have prompted buyers to limit the number of property transactions in their lifetime. Where people once moved as their needs evolved, newlyweds today are more likely to purchase a long-term home that accommodates future children rather than upgrading gradually. A lower tax would encourage more frequent transactions, increasing overall revenue despite a reduced rate. After all, high taxes are futile if they stifle market activity altogether. A more fluid property market means more money circulating through the economy. There is such an opportunity to turbo boost the market. Yet, the early signals from our new government suggest otherwise – so, regrettably, this may remain nothing more than wishful thinking!”
Nightmare: “My greatest concern is the prospect of yet another rise in Stamp Duty surcharges on second homes or foreign buyers. Such measures would dampen demand and make the UK less attractive to international investors. With uncertainty in the US and a fragile EU economy, now is precisely the time to welcome wealthy investors, not repel them. Rather than deterring foreign buyers, we should be encouraging them.”
It may be sensible for the Government to investigate why areas with low taxation, such as Florida, are doing so well
– Charles Curran, Managing Director at Maskells Estate Agent
“According to the OBR, in 2024/25 the Public Sector raised £1,148.7Bn (£40,000 per household) vs spending £1,276.2Bn (£45,000 per household). The UK is therefore running a budget deficit. Prior to the market correction over the past weeks, the impending US Tariffs and the expected spend on defence, the OBR predicated that this deficit would fall to £70.6bn over the next five years. It is now likely to take much longer.
“Whilst the cost cutting headlines are welcome, our opinion is that the only way to deal with this debt pile is economic growth, which can only be obtained via investment and confidence, both home-grown and foreign. For example, at home, imposing Inheritance Tax on Farmers and businesses is, simply put, ill-conceived as no thought has been levelled on how this tax will be paid: The burden is likely to lead to the closure of small companies and farms, if they survive the Employer NIC increase. The IHT post NIC increase has been likened to “salting the ground after the battle” by Andrew Griffith MP, Shadow Business Secretary. Overall Business Confidence, according to the Adam Smith Institute’s latest survey, is now of 2.6 out of 10 with 77% of respondence reporting low or very low confidence. It is no wonder foreign corporate investors are waiting by the side-lines.
“For foreign individual investors, Labour must ask itself why anyone would tie themselves to a high tax jurisdiction whereafter 10 years their global assets would fall under the UK inheritance Tax net, even if those assets have nothing to do with, and were not generated in the UK. It may be sensible for the Government to investigate why areas with low taxation, such as Florida, are doing so well.
“Therefore, Labour needs to introduce an attractive tax regime to drive investment and positive sentiment that in turn will have a galvanising effect across all sectors, including the property market. In our opinion, the Chancellor needs to continue cutting costs, talk to the Gilt Market, lower taxes, reduce red-tape and then leave it to the private sector.”
The danger is that prime properties are once again seen as easy targets
– Robin Edwards, Partner at London buying agency Curetons
“To be honest we’re really not hopeful about Rachel Reeves’ Spring Forecast, the best we think we can expect is a bit of economic stability and predictability. The prime property market relies on confidence – when buyers and investors feel secure in their financial outlook, they’re far more willing to make significant purchases.
“Stamp duty remains one of the biggest issues, acting as a deterrent not just to new buyers, but also to those looking to move up or down the ladder. While it’s unlikely we’ll see a wholesale reduction, even the hint of an easing or targeted relief for specific groups, such as first-time buyers and downsizers, could inject some much-needed momentum into the market.
“What we most fear is that Reeves in her desire to appear “fiscally prudent” opts to introduce further tax hikes or clampdowns on prime property. There’s been a lot of rhetoric around wealth taxes recently and the danger is that prime properties are once again seen as easy targets. Additional taxes, whether on second homes, foreign ownership or more stringent capital gains tax on high-end property sales could prove devastating.
“It’s not just about more taxes though, but the ongoing erosion of incentives that once made London so appealing to HNWIs around the world. Non-dom reforms have already chipped away at the city’s appeal for wealthy internationals. The UK lost 10,800 millionaires to foreign countries last year, more than double the number that left in 2013. That means since Labour came to power one millionaire has left the UK every 45 minutes. We don’t need yet another signal that the UK is an inhospitable place to put down roots or invest. The constant uncertainty around taxation only amplifies the sense that the UK is becoming increasingly unwelcoming to wealth and success.”
Sustained policy stability would serve as a positive springboard
– Laura Dam Villena, Head of London residential agency at Cluttons
“While stamp duty reductions would be very welcome, it’s unlikely any significant changes will be made.
“In any event, the ideal outcome of the spring budget would be for Rachel Reeves to deliver a statement that creates confidence in the growth of our economy. Sustained policy stability would serve as a positive springboard, encouraging activity amongst both domestic and international buyers alike.”
Be bold and scrap Stamp Duty altogether
– Jennie Hancock, founder and director of West Sussex & Hampshire buying agency Property Acquisitions
“It might seem like a distant memory, but many of us in the property industry can remember the halcyon days of a single 1% rate of stamp duty, until it started creeping steadily upwards after 1997.
“People moved house every 3 or 4 years, when their circumstances changed such as a new job, a new baby, or when their children had left home and they wanted to downsize. And every time they did so, solicitors, estate agents, surveyors, removals firms, builders, architects and so on, all got paid – and so did the government via their taxes.
“Today, stamp duty has distorted and constrained the market so heavily, that we have older homeowners rattling around in large family homes which they no longer need or want, because they can’t face handing £150,000 to the tax man. They would rather stay put and hire a gardener or a housekeeper with that money.
“Meanwhile families are crammed into smaller properties, unable to afford to upsize because there aren’t enough large family homes to choose from. Plus, the stagnated market means they probably haven’t made much on their current home – so the enormous stamp duty bill they would face to upsize has to come out of their existing equity.
“When people don’t move home, the economy suffers, which is why stamp duty is such a pointless and prohibitive tax. As well as all the service providers and suppliers in the property ecosystem who lose out, it’s harder for companies to recruit, workers are forced to commute further to work and you end up with a far less mobile and less productive population.
“This is unlikely to be a tax cutting budget, but I wish the government could see just how much of an economic own goal stamp duty is.”
To attract investors, entrepreneurs as well as wealthy individuals, we would like the Chancellor to consider tax incentives and streamline regulations that promote innovation
– David Johnson of property consultancy INHOUS
“Although there is no traditional Spring Budget this year, we expect the Chancellor to announce further measures to tackle the nation’s debt and rising inflation which has hit 3% last month. To date, Rachel Reeves’ Autumn Statement has had a number of implications on the UK property market; especially on first-time buyers who will be facing higher stamp duty thresholds as of April.
“Despite news of wealthy individuals leaving the UK, we have since seen a gradual increase in the number of buyers with budgets over £5million. The Chancellor’s more recent decision to soften non-dom tax changes may have contributed to this uplift. To attract investors, entrepreneurs as well as wealthy individuals, who are crucial for the UK economy, we would like the Chancellor to consider tax incentives and streamline regulations that promote innovation.”
We are still not seeing the return of international buyers who were ever present in the years before Brexit
– Dominic Agace, Chief Executive of Winkworth
What measures could the Chancellor announce in a Spring Forecast Statement that would bolster the property market? “A full-scale replacement for the Help to Buy scheme to ensure there is demand for developers to build the right properties for first time buyers and to help FTBs get on the housing ladder. This would support developers to help meet their house building targets – and those set by the Government. The Government needs to tackle stamp duty if they want to make it easier to move and have the economic benefits of a more fluid housing market. This has been proven every time there is a tweak to stamp duty – most recently by the rush driven by the March 31st deadline.”
Which policies could (or already are) doing most damage to the high-value residential property sector? “From a London perspective, we are still not seeing the return of international buyers who were ever present in the years before Brexit. This reflects the fact that so far Labour hasn’t boosted the demand from the international community to live and work in London. The growth narrative from the Government has yet to be delivered. The prevailing sentiment is concern about future taxation targeting high net worth individuals. The Government needs to change the mood music. Reforming their own non-dom taxation initiative further would go some way towards that. They also need to address inheritance tax changes. Non-doms who have built wealth overseas are now finding it will be caught up in UK taxation should they stay too long in the country. The top of the market is struggling in the face of this.
“This seems to be more of a political stance, rather than one rooted in economics. These high net worth individuals are wealth generators. This is recognised by other countries such as Italy, which is actively pursuing them. The UK, as a small nation without an abundance of natural resources, is at its best as an internationalist trading nation. To fulfill the role globally, it needs to look at changing its international perception. More effort is being made on the international stage and global relations. However, policy needs to follow, and so removing barriers to net worth individuals to live here would be a good starting point.”
Stamp duty has to be reformed
– Nick Austin, agent with RiverHomes in Putney, and Conservative councillor & housing spokesperson for Wandsworth council
What measures could the chancellor announce in a Spring Forecast Statement that would bolster the property market? “Stamp duty has to be reformed. Boomers are staying in homes that are far too large for them because they can’t afford the stamp duty that they’d invariably have to pay to downsize. They’re not moving down the property ladder which means that families can’t move up the ladder. First time buyers can’t enter the market because the whole market is log jammed. We may be operating near or at the top of the market but the bottom of the market has to move to support the rest.
Which policies could (or already are) doing most damage to the high-value residential property sector? “Where do I start? The tax relief reductions on buy-to-let, the doubling of council tax on second homes and the changes to non-dom status are all leading us to where we are now. It’s a demand issue. Almost every agent has a surplus of flats on their books they are struggling to shift. The gulf between flat prices and house prices has never been wider and today’s headlines show that there have never been so many empty properties in London yet we have a housing shortage. What’s more, agents rely on volume and it was typically apartment sales that we relied on to keep up the number of transactions. Flat sales injected liquidity into the property market and without them, the whole property industry suffers.”
Any moderation of SDLT would be welcomed. However, neither moderate or substantial changes seem likely
– Simon Capp, Head of Residential Sales at British Land
“Stamp Duty (SDLT), alongside purchase and ownership costs, is front of mind for buyers when calculating the affordability of prospective purchases. SDLT is a substantial source of revenue for the Chancellor, but to maximise tax revenue the right balance needs to be struck to encourage a healthy rate of transactional activity. Essentially at what level will SDLT encourage buyers to buy and sellers to sell.
“With headwinds continuing in the market, namely elevated interest rates which are expected to track downwards slower than earlier predictions, buyers in the current climate are measured and methodical in their decision making. As an affordability barrier, any moderation of SDLT would be welcomed. However, neither moderate or substantial changes seem likely. The UK residential market is remarkably robust, and so far, 2025 has demonstrated green shoots with increased new enquiries and strengthened appetite from buyers looking to make a property move by the end of the year.”
The biggest threats to the market have already hit, and are here to stay
– Ranjit Thaker, Founder of Thaker Acquisitions
Fears: “The biggest threats to the market have already hit, and are here to stay. The most realistic announcement that should come into force is an extension for First-time buyers to benefit from the current threshold of £425,000 before being liable for SDLT. Although this is more fruitful to the lower end of the market, it will create momentum and prevent subdued transaction volumes in the liquid core market from £500k – £3m in central London.
“Another way the chancellor could show some ingenuity would be to incentivise downsizers and homeowners looking to restore and refurbish unmodernised empty properties. Domestic families looking to downsize hesitate due to the front-loaded buying costs, so by creating some downsizer relief this would naturally create more of a buying cycle and free up much-needed family homes. Currently, buyers brave enough looking to undergo extensive work have a VAT benefit of 5% on renovations for properties that have been empty for two years or more. Reducing this window to say 1 year would create impetus for end users to take on full projects in a market where turnkey stock is heavily undersupplied.”
Hopes: “The aftermath of the chancellor’s NonDom reform changes, specifically on the IHT 10-year tail, has caused the exodus of millionaires that has dominated headlines in 2025. NonDoms exposed to UK inheritance tax on their worldwide assets along with additional stamp duty surcharges have been the kiss of death in terms of sentiment. The biggest issue is some people may relocate but are not in a rush to sell their high-value assets and are opting to retain these homes in their portfolios, thus creating even more pent-up inventory. The total buying costs for an overseas buyer are now maxing out at 19% and with stock levels increasing, they are in the driver’s seat to sit back and be discerning.”
It is unlikely that the Chancellor will take pity on landlords
– Mark Harris, chief executive of mortgage broker SPF Private Clients
“The obvious choice perhaps for boosting transactions in the housing market is reform of stamp duty. The government is keen to support first-time buyers as demonstrated with the continuation of the albeit rebadged Mortgage Guarantee Scheme, so not extending the current stamp duty concession, which ends on 31 March, is a little surprising. Perhaps consideration of a revised scale for first-time buyers will be revisited and if it isn’t, then it should be.
“First-time buyers are strapped for cash and face a big enough struggle to pull together a deposit – shelling out thousands of pounds on stamp duty on top is a disincentive to buying. And if we don’t have enough first-time buyers, which are the lifeblood of the market, those transactions higher up the ladder which are dependent on having a first-time buyer at the bottom, won’t happen either.
“At the other end of the scale, an incentive – again, most likely stamp duty reform – for those seeking to downsize would be helpful. Many properties are under-occupied by older borrowers who want to downsize but face too many barriers to doing so. Scrapping stamp duty for this cohort may lead to more supply to the property market.
“Housebuilding is said to be very important for this government, as indeed it has been for every other. With the drive to build 1.5mn properties, perhaps a revised version of Help 2 Buy could be considered. While the scheme had its detractors, it did incentivise builders to build as well as offering assistance to borrowers so that they could obtain finance.
“While landlords may feel they have been politically targeted and financially beaten enough, it is unlikely that the Chancellor will take pity on them and reverse any recent moves. With Reeves caught in a sticky position, either having to cut back on spending or raise revenue, she may look at changes to capital gains tax. This was left unchanged in the Budget, despite fears that it could increase considerably on property sales. If noise is made around increases to CGT, this may encourage further amateur landlords to sell up.”
An extension of the enhanced SDLT thresholds would be beneficial
– Lisa Simon, Head of Residential, Carter Jonas
“An extension of the enhanced Stamp Duty Land Tax (SDLT) thresholds would be beneficial as it supports first-time buyers and stimulates broader market activity. Furthermore, an in-depth review of SDLT is warranted. The current structure has significant jumps at higher property values, which can disproportionately affect the housing markets across different regions. In some areas, high-value properties represent a significant portion of the market. Adjusting the step changes in SDLT for these properties could enhance their appeal and help unlock movement in this segment of the market.
“Recent changes to non-domicile tax rules have created significant market uncertainty. Easing some of these rules may encourage greater overseas or international investment in the prime property sector.
“Additionally, an adjustment to Capital Gains Tax (CGT) could motivate homeowners to sell, thereby increasing market supply. Specific CGT relief for certain prime properties, such as those that have been recently renovated, could also be beneficial.”
The Chancellor needs to signal to international investors that the UK is still the right place for them to work, invest and ultimately pay tax
– Liam Monaghan, Managing Director of LCP Private Office
“Having spent the last few weeks travelling in Asia, it is apparent that the Chancellor needs to signal to international investors that the UK is still the right place for them to work, invest and ultimately pay tax. Once you encourage one individual, the rest will follow. If she continues to grab for higher percentage points on Income tax, SDLT, CGT and IH, it will further chase away HNW individuals from the UK, having the opposite effect. Something that could make or break their premiership.’’
What measures could the Chancellor announce in a Spring Forecast Statement that would bolster the property market?
“Tax reform – Reviewing the current systems for stamp duty, inheritance tax and CGT and ultimately reducing rates would help unlock the market, particularly for BTL investors who have faced an ever-growing number of challenges, regulations and increased financial responsibilities which have discouraged growth in this sector.
“Addressing issues in the Planning system – Simplifying and expediting the planning process to allow developers to bring new high-end residential projects to market more quickly, as well as introducing measures to encourage the construction of more high-end properties in PCL to meet demand, such as incentivising developers and relaxing certain building restrictions.
“Introducing measures to help speed up the conveyancing process to increase transaction levels and generally improve the efficiency of the market. Measures might include enhanced digitalisation and automation of the system, streamlining the local authority search process, encouraging the use of technology more in the legal sector and even setting a transaction deadline policy.
“Measures to promote domestic investment – such as tax incentives, or a government led scheme akin to Help to Buy but for luxury property, to attract more domestic high-net-worth individuals to buy in Central London.”
Which policies could (or already are) doing most damage to the high-value residential property sector?
“Increased stamp duty rates, particularly for properties over £1.5 million, have pushed up transaction costs significantly, discouraging both domestic and international buyers from entering the market or making multiple transactions. The 2% surcharge for non-UK residents has had significant impact in reducing the attractiveness of the PCL market and deterring foreign investment. It has also created the perception that the UK is becoming less welcoming to international investors, driving them to look to other more advantageous jurisdictions for investment opportunities.
“Reduced tax relief on mortgage interest payments for buy-to-let landlords and the additional stamp duty surcharge on second homes have significantly negatively affected the rental and investment markets in PCL, disincentivising new investors from entering the market and leading many historic landlords to sell up. This in turn only negatively impacts the rental market from a tenant perspective, as a reduction in stock leads to higher rents, limited choice and high competition amongst renters.”
The time approaching every budget is full of uncertainty and sometimes anxiety
– Claire Whisker, founder of property advisor platform First In The Door
“The time approaching every budget is full of uncertainty and sometimes anxiety. There are often rumours of what may or may not happen, as regards property, most of which doesn’t happen. This year the fear is more tax aimed at either property directly through the recently mentioned wealth tax, or more tax or costs associated with the transitional costs of moving. For a lot of people in the higher price bands the escalating stamp duty table means 19% additional cost on top of the purchase price, and that is before lawyers fees, agents fees, removal costs etc.. Any change that adds more burden to the cost of moving we think will be detrimental to all levels of the market.
“In terms of hope – we always hope for the aforementioned to be reversed, so that the market starts to flow again, but this current government may not see the long term benefits of this policy in terms of the extra revenues generated by allowing people to buy and sell more freely.”
The reality is that without bold action, the market will continue to stagnate
– Alex Macaulay, MD at property developer Kinland
“The property market has long been held back by the same structural issues, yet little has been done to address them. If the Chancellor is serious about revitalising the sector, Stamp Duty Land Tax reform must be a priority. It remains the biggest obstacle to a dynamic, fluid market—discouraging transactions and making high-value residential property less accessible. Equally, we need to reconsider how we treat international buyers. For too long, they’ve been pushed away by punitive surcharges and an increasingly hostile tax environment, which has significantly weakened demand in the prime sector.
“Inheritance tax is another antiquated regime that stifles long-term investment, adding unnecessary complexity to an already convoluted system. Instead of policies that encourage growth, we’ve seen layers of taxation that make the market less attractive to both domestic and international buyers. The reality is that without bold action—whether through tax simplification, incentives, or a more welcoming approach to global investment—the market will continue to stagnate. Unfortunately, history suggests that rather than meaningful reform, we are more likely to see minor tweaks at best, or further taxation at worst, as the government looks to fill its coffers rather than support the real estate sector.”
Restrictive rules still prevent many smaller housebuilders from accessing the loans they need
– Wayne Douglas, MD at City & Country
“The recent extension of the Home Building Fund for SMEs is a step in the right direction, but restrictive rules still prevent many smaller housebuilders from accessing the loans they need. This scheme alone isn’t enough. The Government must go further by offering zero or low-cost finance through Homes England, available to all SMEs, not just those rejected by commercial lenders.
“This could really level the playing field, taking away an unreasonable level of risk to make smaller, potentially more tricky schemes, like urban brownfield sites and empty retail spaces, into viable projects for smaller housebuilders, that would never be of interest to the largest players.
“Without suitable finance support from the Government, these sites will remain untouched, and the Government’s 1.5 million homes target will be out of reach.”
Clarity is required on key tax policies, including non-domicile status, Inheritance Tax, and Capital Gains Tax
– Marco Previero, Co-Founder and Head of Research at R3Location
“The government should prioritise policies that lower transaction costs to encourage investment and stability. While we do not expect this to happen, a clear commitment to reforming Stamp Duty Land Tax, for example, particularly by reducing rates for prime and super-prime properties, would provide much-needed stimulus to a market that has stagnated over the past year.
“Clarity is also required on key tax policies, including non-domicile status, Inheritance Tax, and Capital Gains Tax (CGT), especially considering last year’s budget uncertainty and policy reversals. Potential tax hikes on high-value properties, such as increased annual property taxes are a concern, but unlikely to happen this spring – the same may not hold true for higher CGT rates. I fear that the Chancellor may attempt to rebalance the current political narrative surrounding benefit reform by shifting focus onto wealthier property owners, but I hope this is not the case.
“What’s more, any adverse changes to non-domicile tax rules would only heighten uncertainty, further weakening an already fragile prime property market.”
Prime country house buyers are just starting to get used to a degree of what feels like relative stability, not more uncertainty
– Ross D’Aniello, Co-Founder of Midlands-based estate agency Chartwell Noble
“With the Chancellor’s Spring Forecast looming, buyers and sellers in the prime country house market across central England, the Cotswolds, are just starting to get used to a degree of what feels like relative stability, not more uncertainty.
“At Chartwell Noble, we see first-hand how uncertainty can have a detrimental impact on confidence and how tweaks to tax policy can shape sentiment. If Rachel Reeves wants to bolster the market, Stamp Duty reform for downsizers would be the single most effective move. The current structure stifles transactions at the top end, particularly for downsizers who could free up supply. A targeted SDLT reduction for those looking to downsize – or even a holiday – would inject much-needed confidence and be beneficial.
“What we fear most is a fresh assault on property wealth. Even talk of a ‘Mansion Tax’ or higher Capital Gains Tax on additional homes would discourage investment and stagnate the market. Rural estates and landowners are already feeling sore from the impact of recent changes to Inheritance Tax relief on agricultural and development land, making succession planning more complex and discouraging long-term investment. If the government tightens these rules further, it risks further undermining rural property values and land supply.
“Equally damaging would be more punitive levies on overseas buyers, which could deter demand for best-in-class properties. The prime property sector is a major driver of economic activity beyond just sales. More tax isn’t the answer, liquidity is. The Chancellor should focus on encouraging movement, not penalising those who want to transact.”
Changes to non-dom tax status are already having a detrimental impact on the prime property market
– Henry Lumby, Chief Commercial Officer at Auriens
What measures could the Chancellor announce in a Spring Forecast Statement that would bolster the property market? “One of the most effective ways to stimulate the prime property market would be to reform Stamp Duty. The current high rates of Stamp Duty have significantly contributed to stagnation in the London property market over the past decade, discouraging transactions and limiting real growth. A targeted reduction, particularly for those downsizing, would incentivise homeowners to move from properties they are under-occupying, freeing up larger properties and increasing overall market activity.”
Which policies could (or already are) doing most damage to the high-value residential property sector? “The proposed changes to non-dom tax status, coupled with the lack of detail since the Budget, are already having a detrimental impact on the prime property market. The uncertainty surrounding these changes has deterred international buyers, leading to lower transaction volumes and a slowdown in the prime London market. This hesitation is not only affecting property investment but also wider economic activity. The policy is counter to the Government’s stated aim of driving economic growth and is ultimately reducing tax revenues, with HMRC already seeing a decline in Stamp Duty receipts.”
While a cut to SDLT across the board is highly unlikely, it would significantly stimulate market activity
– Peter Greatorex, Managing Director, Peter Greatorex Unique Homes
“As with any fiscal forecast, there is always an opportunity to support the prime property market by reassessing Stamp Duty Land Tax (SDLT). While a cut to SDLT across the board is highly unlikely, it would significantly stimulate market activity, benefiting both buyers and sellers by reducing the upfront tax burden and improving market fluidity. Additionally, the recent increase in SDLT for additional properties from 3% to 5% is already deterring investment in the rental sector, exacerbating supply shortages and driving up rents. A more balanced approach would encourage investment, supporting both the sales and lettings markets. Furthermore, targeted incentives for urban property development, particularly in historic cities like Bath, would provide a further boost by supporting the refurbishment of existing buildings and the construction of high-quality apartments to meet growing demand while preserving architectural heritage.
“Most damaging would be further increases in SDLT for high-value properties, which would dampen market activity and potentially lead to reduced transactions and stagnation in the sector. The super-prime market has already seen price corrections, and additional tax burdens would only accelerate this trend. Moreover, recent changes to taxation for non-domiciled residents risk discouraging international investors who have long played a crucial role in the UK’s luxury property sector. While ensuring fairness in taxation is important, maintaining policies that attract global investment is essential to sustaining the health of the prime residential market.”
While London homes remain the most expensive in the country, its house prices are not rising as fast as elsewhere in the country
By Ruth Bloomfield
With London’s house prices on a go-slow, the place to go to meet a newly-minted property millionaire is Cambridge.
In the past year the university city has entered the rollcall of new £1m property markets, along with Chichester and Winchelsea, both in West Sussex.
This means that at least 20 per cent of local homes were sold for £1m or more in at least six months between September 2023 and September 2024, according to research from Knight Frank.
This is almost three times the national average sale price of average sale price of £343,822, according to Savills.
Today’s research concentrates on areas where the proportion of £1.5m homes has grown.
Central London remains the UK’s most expensive location – but many of its postcodes have been dominated by £1m+ sales for decades.
The capital’s best performer in terms of seven-figure sales in the past year was voguish East Dulwich, where the number of £1m+ sales increased from 26 per cent to 32 per cent of the total as families pile into the area for its good amenities, and green space.
“We have seen a lot of activity, and competition for three- to four-bedroom Victorian family houses near to transport links and good schools,” said buying agent Camilla Dell, managing partner of Black Brick.
“Compared to Prime Central London it is like a different country.”
Tom Bill, head of UK residential research at Knight Frank, blames the high cost of borrowing for inhibiting price growth in the UK.
In 2022/23 11 locations became new £1m+ markets compared to just three a year later.
The locations that did manage to cross the £1m+ threshold are all close enough to London to allow for at least a hybrid commute.
Cambridge is a lively, cosmopolitan city with a great range of bars and shops and excellent schools. Trains to King’s Cross take from 48 minutes.
Chichester and Winchelsea are further away, but both allow buyers to live the dream being close to the sea.
“The enduring appeal of waterfront living has significantly bolstered property values in areas like Chichester and Winchelsea,” said Hamish Humfrey, head of national waterfront at Knight Frank.
“Their relative proximity to London enhances their appeal, providing an accessible retreat from urban life without compromising convenience.
The limited availability of waterfront properties in these regions further intensifies demand, leading to notable increases in value.”
Knight Frank forecasts that UK house prices will increase by 2.5 per cent during 2025, which should create more £1m+ markets over the next year.
In Notting Hill a serene garden square reveals a startling trend: most houses stand empty. Is it tax changes, market timing or something more sinister?
By Melissa York
There’s a serene garden square in Notting Hill surrounded by majestic three-storey double-fronted homes. The driveways are as bare as the trees on a cold wintry morning, and many of the windows shuttered.
“It started to empty out just before Christmas and it’s getting emptier by the day,” says one of the homeowners. Of 15 houses she suspects only three of them are occupied. “You can get a parking space on the street easily these days whereas you couldn’t before. It’s very noticeable. The lights are on in all the houses because they’ve shut it up but left their housekeepers and live-in staff to look after it,” she says.
“It’s not just Notting Hill,” she insists. “It’s large parts of Kensington as well. We know quite a lot of people in the area who have left. It’s all about taxation.” To underline her point, she says one of her friends has just bought a house in Kensington from a couple who are off to low-tax Dubai.
It is a phenomenon across the capital’s most expensive neighbourhoods from Hampstead in the northwest to Chelsea in the southwest. A combination of tax changes – it is estimated that Britain lost a net 10,800 millionaires to migration last year — a stagnant luxury property market and a wet winter means thousands of high-end homes are empty for the best part of a year.
Almost a million homes in England, or 1 in 25 properties, are not lived in regularly, data from the Action on Empty Homes campaign shows. Of these, 256,061 have been empty for six months or longer, 4,000 more than last year, and the number of long-term empty homes are now at their highest level since 2011. Some 279,870 homes are not used as the owner’s primary residence, up 6.3 per cent since 2023.
The situation is not likely to improve anytime soon. Next month non-dom status will be abolished and replaced with a residence-based regime that means foreign earnings will be subject to UK inheritance tax rules.
Meanwhile many of Britain’s comfortable middle classes —not only the international wealthy — are also toying with the idea of a move motivated by Labour’s tax hikes (both real such as the inheritance tax on pensions and anticipated, higher capital gains tax being of key concern).
Overseas estate agents all report an uptick in inquiries from British buyers about leaving. Malta, Milan, Switzerland and Italy are popular options, although they report that many Brits are just exploring their options for now.
“It is mostly about a potential move, especially for the British clients. Non-British clients are more likely to be more globally mobile,” says Alex Koch de Gooreynd, a partner in international sales at Knight Frank estate agency.
“They all say to me that they don’t have an issue paying tax but they do have an issue paying inheritance tax on their worldwide assets. They look at Portugal and Switzerland, where there is zero inheritance tax and it looks attractive.”
Back in Notting Hill, on Clarendon Road, the only resident who was home to answer the door thinks the silent streets have more to do with demographics and drizzle than non-doms.
Bouncing a baby on her hip, she says: “A lot of [the homeowners] around here are international — Europeans, Americans — and they are very wealthy people who have two or three homes to go to. It’s like they live in a parallel universe.”
Alexander Litos, who mans the front desk at One Click Dry Cleaning near Notting Hill Gate Tube station, is also unfazed. “It’s very seasonal around here,” he says. “We wouldn’t notice whether anyone had left until the summer months leading up to when the children go back to school in September.”
Whether it’s tax, the weather or overseas buyers, smart neighbourhoods in central London are littered with properties that are empty for large parts of the year.
Unsold for years
Unrealistic pricing by super-rich sellers is another reason homes are unoccupied, as they languish on a stagnant London property market, waiting for sales that never happen for years. These very rich residents don’t have any financial need to sell — so they keep homes on the market at unrealistic prices, often for years.
On Grosvenor Crescent Mews, an ultra-exclusive cobbled cul-de-sac protected by a security checkpoint and a short horse guard’s gallop from Buckingham Palace, there’s a four-bedroom, four-storey house that is being sold by the Indian tea billionaire Rishi Sethia and his wife, Queenie Singh. They bought it for £9.5 million in the autumn of 2020, but have never spent a single night there and put the house on the market in November 2023 for £13 million. They have now reduced the price to £10.99 million. It has been unoccupied for at least five years.
“We had a couple of bids around the £11.5 million mark. I bet now they wish they’d taken them, but here we are, you know, a year on…” says Paul Finch, head of new homes at the estate agency Beauchamp Estates, as he walks around the neighbourhood.
Finch says homes in Knightsbridge and Belgravia have had a particularly slow year because many of them require significant upgrades, which buyers don’t want to do. “If they’re coming from overseas, they just don’t want the hassle of doing the work,” he says.
He walks down Lyall Street, where numerous large whitewashed homes are sitting unsold on Beauchamp’s books.
One sprawling property has been empty since a Turkish family paid £14 million for it in 2017, and he says it is now in a poor state. The family bought it with the intention of doing it up and moving there to coincide with their son starting university. But in the end they bought their son a £10 million flat somewhere else in London and never moved in.
Finch says: “It is still sitting here now and they’re saying, ‘Well, we want £20 million for it.’ You’re not going to get £20 million for it. It’s not going to happen.”
Asked what will make them change their mind, he says they don’t need to sell if they don’t want to because they’re so wealthy. “They’ll just sit on it until they have an epiphany, or somebody mad as a box of frogs comes along and pays their price.”
A society mansion, once owned by the gambling tycoon Lord Aspinall, then by the Delevingne family (including the models Cara and Poppy), and now owned by a British billionaire, has sat on the market unsold for 15 months.
The 5,456 sq ft house in Belgravia, with animal print walls and gold gilded ceilings, was originally listed for £23.5 million when it came on to the market early last year. Finch persuaded the billionaire to drop his price to £21 million at the start of this year, and there have been a few viewings since but no sign of a sale.
Frequently the problem is caused by agents who cynically overvalue homes just to flatter their super-rich clients and get a commission. A 2,674 sq ft, three-bedroom duplex penthouse at Eaton Place — previously the London home of Christine McVie of Fleetwood Mac, who died in 2022 — was listed for sale this month by her estate. Several agents quoted valuations of £8 million, £10 million and £12 million, says Finch, but he advised a more realistic price of £6.95 million and suggested a makeover by an interior designer — responding to the slowness of the market. The estate went ahead with Beauchamp’s more realistic price — discounting being crucial in this market — but all too frequently this doesn’t happen.
An empty home’s industry
Behind their bolted doors there is a whole army of service staff keeping these houses running. Camilla Dell, founder of the property buying agency Black Brick, set up a Vacant Care division in 2007 after she called her clients to see how they were getting on with the new properties she had helped them buy only to discover they were staying in hotels on short visits to London.
“When I asked why they said it was because they knew their homes would not be ready for them — dusty, not fresh linen, no food in the fridge,” she says.
Spotting a savvy business opportunity, she offered them a service that would plump and primp the property for their impending arrival. All they have to do when they return is turn the key in the door then step inside a warm, clean home stocked with fresh groceries, flowers and wine.
The division has evolved; now called Prime Property Asset Management, Dell sends staff out to empty properties to make heating, plumbing, electrics and ventilation checks — and to make sure no unwanted pests have moved in in the owners’ absence.
If a pipe should burst, owners often can’t claim on their home insurance if they haven’t visited the property in months. “We look after one property in Knightsbridge worth in the region of £10 million and the insurance policy requires us to visit every week,” says Jason Wei, head of the property management division at Black Brick.
There are almost 50 properties on the agency’s maintenance books — 40 per cent of its clients signed up for its management service last year. Simple weekly visits are charged at an hourly rate, but larger homes with more complex requirements, such as smart home systems and swimming pools, cost owners “a few thousand to many thousands of pounds” a month to run while they’re away.
A live-in housekeeper typically costs between £17,000 and £22,000 a year, according to the jobs website Glassdoor — a costly way to keep the lights on if no one’s home.
Owners pay £120 plus VAT an hour to use service staff at Eccord, a buying and property management company in central London. Aside from maintenance, staff also pay the bills because some owners don’t want to give live-in staff access to funds in their absence.
Eccord manages about 30 properties, half of which are empty for part of the year, says Jo Eccles, its founder and managing director.
She adds: “Some of them will come to London for a couple of months in the summer because it’s too hot where they are, or they might be in town because they love watching the tennis at Queen’s, then they’ll go to Wimbledon, they’ll soak up Chelsea Flower Show, then they’ll be off again.”
Eccord will usually visit an empty property every 14 days to compile photographs, meter readings and other documents into a report for the homeowner.
Staff wandering in and out also deters burglars, an ever-present problem in prime postcodes. Eccles says, “With certain larger properties, we have key holding services in place. If an alarm gets triggered, someone will be at the property within 20 minutes. If it’s during working hours, we normally go. If it’s outside of working hours, the key-holding company will go.”
Growing security concerns are affecting London’s reputation as a “triple-A” destination by the very rich, experts say.
The non-dom tax issue, says George Azar, chairman and chief executive of Sotheby’s International Realty, United Kingdom, Dubai and Saudi Arabia, is “already embedded in the prices” — but there is a perception that crime is getting worse and policing is weak, especially among Middle Eastern owners.
“People are scared to wear their jewellery, their watches,” he says. “Today rich people, when they go into London in the summer, they have security with them. That means something is wrong with the country.”
Wealthy individuals may be spending less time in their London home as a result, but the profit to be made if they can just wait out this sluggish market means they are willing to pay through the nose to keep them empty.
“The problem is, if you’re worth a billion, having 20 million quids’ worth of assets just doing nothing — does it really matter?” Finch tells me.
For many luxury agents trying to sell long-since empty homes, waiting for super-rich sellers to see sense and drop the price is certainly a long game.
The Secret Agent on… empty homes
Houses and flats in central London postcodes often sit empty for most of the year. If you walk around Belgravia, Knightsbridge and Mayfair in the evening you won’t see many lights on. Case in point: One Hyde Park, dominating Knightsbridge but hardly ever lived in, going by the lights left off inside.
I sold a house in Belgravia in 2016 that was 10,000 sq ft. It was used as a garage (it came with a mews). My client, a Middle Eastern gentleman, had bought it four years prior as a turnkey property and simply parked his Rolls-Royce Phantom and Range Rover in the garage, but never spent a night there. He preferred a suite at the Dorchester.
It was only when one of his many advisers pointed out the threat of a mansion tax (mooted by a Labour government back in the days of Gordon Brown) that he decided to sell. It seemed he’d forgotten he owned it. Timing was on his side: the market had shifted in the right way, and he made a handsome profit.
My clients from the US can’t believe how little tax those with super-prime property pay. The highest rate of council tax in Westminster and Kensington and Chelsea is less than £3,000 a year. And that’s for flats and houses worth tens of millions.
In New York or California or Illinois or Connecticut you pay hundreds of thousands of dollars in state and city taxes to own properties of similar value. No wonder the internationally mega-wealthy aren’t too agitated about holding on to property in London despite the cost of insurance and staffing. After all, they need to put their money somewhere.
It’s an age-old quandary: we want the very rich to live here for the trickle-down effect, but we also want a vibrant city brimming with the life that only full-time residents can give it.
To paraphrase the French novelist Honoré de Balzac: “Behind every great fortune lies a great crime.” One could forgive the rich for their past … if only they made better neighbours in the present.
“I’m there 20 days a year, and I pay the service charge like the guy who uses the pool every day,” he said. “I no longer live in that apartment, I live in Chelsea.”
Candy listed the property for £175 million in 2021, and it remains on the market with Sotheby’s International Realty.
Like Candy’s apartment, thousands of luxury homes across the capital lie empty. London has the highest percentage of unoccupied homes anywhere in the country. And behind their closed doors, a team of people work around the clock to keep their homes in pristine condition.
“Staff count down the days until their principals leave,” says an employee for one high-net-worth west London family.
“They go from being the dogsbody to being the client, with some jumping at the chance to enjoy all the high-end perks like pools, steam rooms and gyms.
“Chefs end up trying out new five or six-course menu ideas on the staff and we still use drivers to run errands. Pets are often packed off to luxury countryside retreats.”
It’s not all fun and games, however, as staff are expected to work as if their employers were home. Silver is polished and repolished to dazzling effect, wardrobes are organised and any property damage is sorted while owners are away.
“No one would know our employers aren’t home,” adds the anonymous staff member, who counts an impressive (NDA-protected) list of London’s gliteratti as former employers. “There are so many people coming and going.”
At this level chefs and nannies, who tend to work one week on, one week off, can earn £70,000-plus a year. “So there’s no such thing as working from our own homes. If you’re not physically there — unpacking, repacking for the next trip, organising — then you’re not staff for much longer.”
Ultra-rich property owners without a fleet of full-time staff tend to hire property managers to ensure they come back to homes as they left them.
“People usually feel quite anxious about leaving their home empty for long periods of time, not only because it’s more vulnerable to burglary, but they’re conscious that if something goes wrong inside the house it won’t be discovered until they get back,” says Jo Eccles, managing director of buying agency and property management company Eccord.
“Our clients value the peace of mind that comes with knowing someone has been in, walked through the house, checked the heating and hot water and tested the alarm.”
Simmi Sangha, the company’s private homes manager, says most owners are based internationally, but will “dip in and out of London” two or three times a year.
For most luxury homeowners, having someone visit the property regularly is an insurance requirement if it is unoccupied for more than 60 days.
This 30 to 60-minute process is usually weekly or fortnightly — or once, for Sangha’s client’s £25 million Notting Hill house, every 72 hours. No tap, shower or light switch is left unturned.
Sangha is responsible for contracting the unglamorous maintenance tasks for homeowners: maintaining the AC systems, servicing the boilers, checking the gas. “I need to make sure that I’m two steps ahead.”
The idea, theoretically, is that nothing will ever go wrong — or at least, clients won’t be there to see it. As Camilla Dell, founder of buying agency and property management service Black Brick, puts it: “Most people’s approach to home ownership is to wait until something goes wrong, whether that’s a light bulb going, or something more major, like the heating not working, or the boiler breaking down. Our service is all about avoiding that.”
‘We do very weird things’
But while such work is meticulously planned, property managers will also find themselves tasked with more varied requests.
If clients need their plants watered, a video walk-through of their property, new linens purchased or to check whether they left their Chanel jacket in their wardrobe, Sangha will oblige.
When her client was landed an erroneous £11,000 bill from Thames Water, she spent six months fighting to have it corrected. And when another client had all their new furniture delivered to their Chelsea house, Sangha was available to receive, unpack and stage the deliveries.
“The work is so different for each client,” says Sangha. “We do very weird and wonderful bespoke things.”
Yasmin Ulhaq, founder of Glenfield Property Management, is no stranger to this. Ulhaq offers “concierge-style management” which she says “mirrors the experience of a five-star hotel, tailored to each client’s lifestyle”.
Her “platinum” package makes her available 24/7 to clients, 365 days a year. As well as maintenance and insurance checks, she will open, sort and forward mail, ensure that her client’s Bentley is tested in their absence and make specialised payments on some clients’ behalf.
In the past, this has included artwork and the purchase of a Birkin bag as part of a client’s Christmas shopping. “Sometimes, if I’ve got a good enough relationship with those clients, I’ll pay out of my own account and then I’ll be reimbursed.”
Alice Lynch, founder of Lynch Property Services, is responsible for cleaning these empty houses. And if owners aren’t happy with how their homes look, it’s Lynch who will get the call.
“We’ve had people’s children stay in the property and the parents haven’t known. They’ve then said we haven’t cleaned it properly,” she says. “It’s like detective work: you’re trying to piece things together.”
Lynch is often the first person to notice when something has gone wrong: a leak from the radiator, a damp patch — or once, a pigeon in the house. “I don’t know how it got in there, but the carnage from the pigeon was awful,” Lynch says.
“The other problem is pests — mice and rodents. They can get in anywhere, even in the best maintained properties.”
She has found mice nests in sofas and, more troublingly, in bed headboards. She has seen moths eat through homeowners’ woollen clothes, and once, a pair of boots.
It is her job to inform the client or property manager. “Sometimes it feels like we’re the bearer of bad news,” she says.
One of the biggest — and highest pressure — parts of the whole operation is preparing for the owners to return.
There should be no water marks on the sink, no smears on the worktop, no marks on the glass. And crucially, the property should smell clean.
“Sometimes, if it doesn’t smell fresh, people will say that it doesn’t feel clean,” says Lynch. “
Ready and waiting
Ulhaq, likewise, will go to great lengths to prepare her clients’ properties for their impending return. This includes ordering flowers, perfecting the temperature, turning on the lights, preparing the fireplaces, heating the swimming pool and adjusting the clothes in their wardrobes.
She will stock the cupboards with her clients’ favourite products, whether that’s za’atar, protein drinks, okra soaked in water or specific brands of fabric cleaner.
“Even their toothbrush is ready for them. They just want to drop off their suitcase and have somebody — usually the housekeeper — put it in the cupboard,” she says.
“It’s a seamless transition back into their London home. We want it to feel as effortlessly luxurious as in their primary residence, no matter how long or short they’re staying.”
Often, though, Ulhaq doesn’t get much more than a few days’ notice. “It can be last minute, but that’s why the house has got to be ready,” she says.
And so, year-round, these empty properties will remain immaculately kept, beautifully maintained, stocked and prepared, always ready for their owners to return.
The capital is no longer hot property — prime prices have fallen, meaning you can get more for your money. And experts say you can’t blame it all on Labour
By Emanuele Midolo
Dear American multimillionaires looking to buy a home in the UK, I have good news for you: if you have $1 million to splash, you can now get more bang for your buck in London.
The annual Wealth Report published today by the estate agency Knight Frank shows $1 million (about £800,000) now buys you 34 sq m (365 sq ft) in London, up from 23 sq m (248 sq ft) a decade ago — a 43 per cent increase. This makes the British capital better value than it has been for years.
To put it into context, a 200 sq m (2,150 sq ft) penthouse in, say, Marylebone, would now cost you just short of $5.9 million, compared with $8.7 million it would have cost you ten years ago.
Plummeting prices and a favourable currency fluctuation mean that, although bricks and mortar in the capital is still among the most expensive in the world, it is significantly more affordable than it was a decade ago.
London has seen the biggest shift since 2014, says Liam Bailey, the global head of research at Knight Frank. “The three markets that stand out where actually you’re getting more for your money now ten years on are London; Monaco (5 per cent more space), where you’re getting 19 sq m for your million dollars rather than 18 sq m; and New York (2 per cent more space), with 34 sq m rather than 33 sq m.”
How much space $1 million gets you in London and elsewhere
Searching for a luxury home in London? You can get even more for your money in other places.
mericans already made up a quarter of the buyers of the capital’s most expensive properties last year, according to the ultra-prime agency Beauchamp Estates, based on data from the property portal LonRes.
“That’s great for London,” says Camilla Dell, a buying agent and founder of the buying agency BlackBrick, of the latest figures. Some 25 per cent of Dell’s clients are Americans. “We’re pretty busy, despite the fact that the super-prime end of the market is coming down — and that’s just a fact.”
“I’ve just signed on a £20 million deal for an American client. We saved almost 25 per cent from the original asking price. Because there are very few transactions at this end of the market there’s more supply, buyers have more choice, which is fantastic. I’m inundated with options. I’ve got a dozen options for a single client in Mayfair. That’s unheard of.”
Dell says she is buying a property for an American in Chelsea near Sloane Square for close to £5 million. “They want to be close to the action,” she says. And it’s not just Americans: many other nationalities whose currencies are pegged to the dollar, such as in the Middle East or Asia, would benefit from this too.
The London prime property market could do with more millionaires. The Wealth Report calculated that the number of UK residents with assets of $10 million of more has gone up ever so slightly last year, from 55,152 in 2023 to 55,667 in 2024 — a 0.9 per cent rise. But the UK lags well behind regions such as North America, where the number of millionaires over the same period went up by 5.2 per cent, Asia (5 per cent) and even continental Europe (1.4 per cent). Recent figures claim that 11,000 millionaires left the UK last year, 157 per cent more than the previous year.
The reason for that, Bailey from Knight Frank says, is tax. And it’s not even entirely Labour’s fault, he argues.
“It actually wasn’t the last budget, it was Jeremy Hunt’s [the former Conservative chancellor]. As soon as Hunt talked about non-dom abolition and serious reform, that really slowed the market down.”
This is echoed by Paul Finch, a director and head of new homes at Beauchamp Estates, who says: “Over the past six months we have seen a dramatic shake-up in the prime central London property market which has been disrupted by a combination of stamp duty rises, the abolition of the non-dom regime and fears over capital gains tax rises and inheritance tax changes.”
Stamp duty for overseas buyers purchasing a second home in London can be up to 19 per cent. “It was 1 per cent back in 1979,” he says. “This has resulted in a significant outflow of wealthy people from the London market. Mostly these are domestic UK residents and also overseas residents with UK passports who are selling up in London and relocating to Dubai, Switzerland, Monaco, Miami and the French Riviera.”
If the traditional markets of London, Monaco and New York have become more affordable, “emerging” cities like the ones mentioned by Finch have seen the opposite trend.
Where’s up and down in the world’s luxury housing market?
“For most of these markets there’s been a massive price uplift and therefore the amount of space you can get for your million dollars has shrunk quite considerably,” Bailey says.
The two main factors remain the same — house prices and taxes — but reversed. Dubai, in particular, has seen an eye-opening 147 per cent rise in property prices over the past five years.
Although it has slipped from last year’s second place to third, the emirate has seen a 16.9 per cent growth last year, a percentage point more than the previous year.
The other cities at the top of Knight Frank’s list are Seoul (18.4 per cent rise last year) and Manila (17.9 per cent), followed by Dubai, then Riyadh (16 per cent) and Tokyo (12.1 per cent).
Benign taxation, the Wealth Report shows, is also acting as “a pull factor” for some who have chosen to look elsewhere: again Dubai, but also Switzerland and Italy.
Daniel Daggers, the founder of the property advisory DDRE Global, who is based in London but also buys and sells homes for the super rich in Dubai, says records will continue to be broken there “but at a less ferocious pace”.
The next 12 months will be crucial, Daggers believes. “People are still enjoying it but there isn’t the same growth as before,” he says. “That’s what we’re telling our clients, that we need to look at the sustainability of these markets. There is a sense that the champagne is still flowing but the music is slowing.”
Why do some properties get snapped up while others struggle to sell?
By Hugh Graham
Is it a buyers’ market or a sellers’ market? It’s the perennial question in property. In the case of London right now, the answer is both. Sometimes those markets are just streets apart — sometimes they are different houses on the same street.
While good quality family homes below £1.5 million are being snapped up (with many going to sealed bids), more expensive properties can languish on the market enduring discounts in the hope of finding a buyer. Doer-uppers are no longer in favour while turnkey properties near good state schools are in high demand.
Take the case of Yasha Estraikh and Maya Magal. The couple live in a four-bedroom terraced house in Kensal Rise, a family-friendly neighbourhood in northwest London. They have children aged seven, five and one and would like to upsize. They put their Edwardian house on the market for £1,699,950 in November. “We thought it was a terrible time to list, before Christmas, but we had found a house we really liked, and thought, we better get ours on quickly,” Estraikh, 40, a brand investor, says. “We were actually amazed by the reaction.”
They had 12 viewings in 16 days and two offers — one over the asking price at £1.71 million. In hindsight, Estraikh is not surprised. “Every month we get handwritten letters through the door saying, we’re a family, we want to move to the area, are you considering selling?”
Take the case of Yasha Estraikh and Maya Magal. The couple live in a four-bedroom terraced house in Kensal Rise, a family-friendly neighbourhood in northwest London. They have children aged seven, five and one and would like to upsize. They put their Edwardian house on the market for £1,699,950 in November. “We thought it was a terrible time to list, before Christmas, but we had found a house we really liked, and thought, we better get ours on quickly,” Estraikh, 40, a brand investor, says. “We were actually amazed by the reaction.”
They had 12 viewings in 16 days and two offers — one over the asking price at £1.71 million. In hindsight, Estraikh is not surprised. “Every month we get handwritten letters through the door saying, we’re a family, we want to move to the area, are you considering selling?”
The house the couple wanted to buy fell through. But, after accepting the offer for £1.71 million, they were able to find a bigger house with a larger garden in the same neighbourhood, but for a lower price: £1.437 million, reduced from £1.8 million, the initial listing price over a year ago. The reason? It was a fixer-upper.
It’s the houses that are modernised and sold in turnkey condition that are selling well, according to their estate agent Stewart Boyd, who runs Winkworth in Kensal Rise and Queens Park. “In the last five years, since Brexit and Covid, there has been a complete 180 from people who want doer-uppers and people who want a plug-and-play house, just because of the cost of labour and building works.”
Estraikh and Magal’s story is playing out all over the London suburbs. The property market may be in the doldrums in some parts of the country, with reports of price falls and long sales times in the home counties, and a stagnant super-prime London market. But London’s family-house market, between £1 million and £2 million, is hot in many postcodes, according to The Advisory, a property advice website. Its PropCast data determines heat ratings by counting the number of properties on the market in a postcode and calculating the percentage of these that are under offer or sold subject to contract: 0-25 per cent is very cold, 26-34 per cent is cold, 35-49 per cent is hot and anything above 50 is very hot.
PropCast assessed 35 London postcodes and found that 26 of these were hot or very hot. The hottest market between £1 million and £2 million was SE21, which covers Dulwich and Tulse Hill, where 71 per cent of the properties were under offer, followed by N8 (Crouch End and Harringay, 69 per cent), SE22 (East Dulwich, 60 per cent), SE15 (Peckham and Nunhead, 57 per cent) and E11 (Wanstead, 56 per cent). Homes priced between £1 million and £2 million sold 14 per cent more quickly than at all other price points across the capital in 2024, according to the estate agency Savills using data from the consultancy TwentyCi.
Estraikh and Magal’s story is playing out all over the London suburbs. The property market may be in the doldrums in some parts of the country, with reports of price falls and long sales times in the home counties, and a stagnant super-prime London market. But London’s family-house market, between £1 million and £2 million, is hot in many postcodes, according to The Advisory, a property advice website. Its PropCast data determines heat ratings by counting the number of properties on the market in a postcode and calculating the percentage of these that are under offer or sold subject to contract: 0-25 per cent is very cold, 26-34 per cent is cold, 35-49 per cent is hot and anything above 50 is very hot.
Geoff Wilford, the owner of Wilfords estate agency in Battersea, south London, recently sold his own house in a hot area (Wandsworth, SW17), where 48 per cent of the stock is under offer. In 2020 he and his wife spent £400,000 renovating and extending their four-bedroom Victorian terraced house in Bellevue Village, which is in a catchment area for good state schools. They paid £1.23 million for it in 2017. In October they put the house on the market for £2 million. “We had about six viewings, and sold in November for £2.25 million. The market is absolutely flying, as long as houses are priced sensibly.”
Tales of sealed bids are common, but it’s not a frenzied market. In 2014 you might have seen ten parties bidding — now it’s more like two or three, according to Amy Reynolds, the head of sales at Antony Roberts estate agency in Richmond, southwest London. Properties typically get the asking price, or a bit above or below. Savills has forecast a 3 per cent rise in prices for the mainstream London market in 2025, but no price rises for outer prime areas (£1.85 million and above in areas like Chiswick, Wandsworth, Fulham and Islington) and a 4 per cent fall for prime central, such as Chelsea and Belgravia.
“In the outer prime London family neighbourhoods like Fulham and Clapham we’re definitely seeing increased competition, sealed bids, not enough supply and more buyers than there is available stock,” says Camilla Dell, the founder of the buying agency Black Brick. “Part of the reason is people are moving less. In the days when stamp duty was lower, people would take baby steps up the housing ladder. Now they save and live with their parents for longer, and when they are ready to buy, they start with a family house. And that has caused increased competition.”
Supply is still much lower than in previous hot markets, agrees David Fell from the estate agency Hamptons. In January 2016, for instance, there were 386 sales of £1 million to £2 million houses in Greater London; Hamptons expects between half and three quarters of this for January 2025, although the property website Rightmove says the number of sales agreed in London is 17 per cent higher than a year ago.
Not so hot for others
Not everything is being snapped up, though. The PropCast data shows that in the £2 million to £5 million bracket, 26 of the 35 postcodes are cold or very cold. There is a smaller pool of buyers at higher price points, and some of those postcodes have few properties above £2 million.
At this level there are some significant price drops in family-friendly areas. A seven-bedroom Victorian house in Crystal Palace, southeast London, went on in May with Hamptons for £2.35 million and last week reduced its price to £2 million, a 15 per cent drop. An eight-bedroom Victorian fixer-upper in Balham, south London, went on in August for £2.95 million with the agency Knight Frank and was reduced to £2.75 million in December.
Despite talk of a cooling market, the curtain is far from closing on London’s high-end property market. Sales of £5 million-plus homes jumped 25% in late 20241, proving that serious buyers are still firmly in the market. But beyond these eye-catching deals, something more subtle is unfolding.
“A combination of political uncertainty and the additional stamp duty surcharge for second homes and changes in non-doms taxation announced in the Budget has meant that it has not been plain sailing for prime London buyers and sellers this year,” says Nick Maud, Director of Research at Savills. “But the bounce in activity towards the end of the year is a testament to the resilience of this market, and the strength of appetite from domestic buyers.”
On the ground, however, the market does feel different. “I don’t think I’ve ever seen a market quite like it – there’s no shortage of homes to buy,” says Camilla Dell, Founder of buying agency Black Brick.
Jo Eccles, Founder of buying agents Eccord, agrees: “It’s firmly a buyer’s market. Typically, we’re now able to show clients twice as many properties as usual – a striking shift, especially given their sometimes-exacting requirements and high price points. A significant number of these homes belong to sellers rethinking their future in the UK ahead of the new non-domiciled tax rules.”
Shifting dynamics in central London
But it’s not just tax changes driving sellers to the market. Many who had been holding off for years – due to factors like Brexit, the mini-Budget, interest rates, and the general election – are now increasingly ready to sell, having grown weary of waiting for more appealing market conditions.
“For sellers who price realistically, it’s reassuring to know that there are buyers ready to act,” says Stephen Moroukian, Head of Product and Proposition for Real Estate Financing at Barclays Private Bank. “Equally, the current market presents chances for buyers to find high-quality properties at favourable prices.
“Alongside this, changes to the ‘non-dom’ rules are leading many high-net-worth individuals to reassess their long-term plans. Whether you plan to remain in London, rent your property out, or relocate entirely to somewhere like Switzerland, the French Riviera or the Channel Islands, understanding the financial and legal implications of these choices will be key to making informed decisions.”
Given the market conditions and general uncertainty, it’s no surprise that prices have fallen slightly in recent months – particularly in prime Central London, home to some of the capital’s most prestigious neighbourhoods, such as Mayfair, Knightsbridge and Belgravia, all renowned for their luxury housing and global appeal.
“Prime central London saw a slight softening in prices in the fourth quarter, and we expect a further 4% drop in 20252,” says Lucian Cook, Director of Residential Research at Savills. “That said, with prices 20% below their 2014 peak, the area still offers strong value. We project a 9.6% increase3 in prices over the next five years as the market finds its footing in a changing fiscal and regulatory landscape.”
Cook adds: “One of the main reasons we don’t expect further significant price drops is the inflation-adjusted discount, which makes the current value even more compelling. Additionally, the relative strength of the dollar and the weakness of sterling continue to support demand. Moreover, few markets offer the same level of appeal and accessibility as London.”
Stuart Bailey, Head of Super Prime Sales in London at Knight Frank, comments: “Value is the key theme across prime markets right now. Whilst volumes are holding up – or even increasing – in both the prime and super-prime sectors, what has come down is the value of the properties we’re selling.
“So, we’re seeing a focus in the prime market (£5 million-£10 million) on the lower end – £5 million-£7 million – rather than the higher £7 million-£10 million range. In the super-prime (£10 million-plus), there’s also a shift towards properties in the lower ranges, between £10 million-£20 million. Buyers in the higher levels of each price bracket are slightly more hesitant, but deals are still happening – it’s just that we’re seeing some buyers there negotiating prices down.”
London: A city like no other
What makes London so remarkable is that few global cities can match its blend of heritage, culture and modern luxury. The city boasts some of the world’s finest museums and theatres, elite private schools, and a dynamic food scene, with 85 Michelin-starred restaurants catering to every palate4.
London’s reputation for safety, well-regulated property laws and political stability further enhance its long-lasting appeal. Its global connectivity – via the Eurostar and five major airports – ensures it remains a prime destination for international buyers.
“While there’s talk of people wanting to leave, some who have actually relocated are struggling to settle and are finding they miss all that London has to offer,” says Dell at Black Brick. “The reality is there’s no perfect alternative. And despite challenges like the introduction of VAT [value added tax at 20%] on school fees, the UK’s education system remains one of the best in the world and a key draw for families.”
Another example of London’s enduring appeal, despite a market in flux, is the recent sale of The Holme in Regent’s Park, one of the city’s most prestigious properties – and once described as “possibly the world’s most expensive home”5. Situated in the heart of central London, this 29,000-square-foot, multi-million-pound estate is testament to the ongoing demand for the rarest and most luxurious homes. And although the market has softened, properties like The Holme continue to attract buyers who value exclusivity, size and historical significance.
All of these factors – and more – continue to attract buyers, particularly international ones, to London.
“Demand from American buyers especially has been building steadily over the past 12 to 24 months, and they now make up nearly 30% of our clients,” says Eccles at Eccord. “Currency discounts, along with the appeal of the UK lifestyle and education system, remain strong drivers. One of our super-prime American clients told us he had considered his options globally but concluded, ‘There’s only one London’, and is now buying a £20 million house here.”
A two-tier market emerges
Beyond The Holme’s near record-breaking sale6, the high-end property market is evolving, with a clear two-tier split emerging in how the market operates. Eccles of Eccord notes that homes under £15 million are becoming more price-sensitive, with buyers increasingly favouring move-in ready homes. “Anything overpriced is seeing little traction,” says Eccles.
Above £15 million, however, and off-market deals are becoming much more common. “There’s often a shroud of secrecy in many of these deals, too,” she adds. “We’re also seeing a growing divide between turnkey properties and those needing work. Buyers at all price points are willing to pay a premium for the convenience of move-in-ready homes.
“Meanwhile, properties requiring renovations – which make up the majority – are highly price sensitive. In the super-prime market (£20 million and above), there’s also an increasing supply of turnkey properties, as sellers leaving the UK are listing beautifully refurbished homes they hadn’t originally intended to sell.”
Black Brick’s Dell agrees, highlighting the growing challenge of accessing all available properties – especially for those relying solely on online searches. “London’s prime property market is flooded with off-market listings, particularly for homes over £5 million,” she says. “With properties circulating through private groups and networks, buyers are often only seeing a fraction of what’s available online – around 50%, and that can rise to 80% for properties over £10 million. Navigating this complex, invisible market is increasingly driving buyers to work with buying agents.”
Demand for family homes remains strong
Just below the highest property brackets – in outer prime areas like Fulham, Wandsworth, Hampstead, Highgate and Dulwich – demand for family homes remains strong, driven largely by domestic needs-based buyers. Well-priced properties are selling quickly, although buyers still have the upper hand here too.
“These outer-prime London markets have held their value, even showing modest growth7,” notes Cook at Savills. “Beyond the capital, too, prime country markets are stabilising, with annual price falls slowing. However, coastal second-home hotspots remain more price-sensitive, reflecting broader economic pressures.”
Moroukian at Barclays adds: “We’re seeing ongoing demand in the domestic family home market. Although the market is competitive, these areas remain resilient, with families looking for stable, long-term homes – which is driving ongoing activity.”
Rental market shifts
Rental trends are also shifting. While some landlords are exiting the market due to lower returns, there are more ‘accidental landlords’ emerging, with those unable to secure their asking prices choosing to rent out their properties instead.
Then there is the new Foreign Income and Gains (FIG) regime, effective from April 2025, which replaces the old ‘non-dom’ regime and allows non-domiciled individuals to reside in the UK for up to four years without paying UK tax on foreign income and gains.
“We expect to see more people entering this regime and opting to rent rather than buy, given the time frames – even now, we’re seeing rental activity on the rise,” says Dell at Black Brick.
For those renting high-value properties, understanding the tenancy agreement and its implications is critical. “If you move into a rental property in England with a yearly rent of £100,000 or more, you will be entering into what is known as a common law tenancy,” explains Camilla Tunnicliffe, Knowledge Lawyer at Farrer & Co.
“Unlike tenants of an assured tenancy [which applies to annual rents under £100,000], common law tenants will not benefit from a range of statutory rights and protections intended to safeguard those living in rented accommodation, including those due to be introduced under the Renters’ Rights Bill. Given this lack of statutory protection and the high value of the property, we would always recommend seeking legal advice before entering into a common law tenancy.”
London: A prime destination for property buyers
Yet, despite some of the challenges mentioned above, London’s appeal remains strong. As a global powerhouse, it continues to offer long-term value and exclusivity that few cities can match.
“London will always be a prime destination for property buyers,” says Moroukian at Barclays. “Its ability to weather market shifts ensures it remains a prime location for property investors.”
Agents have welcomed the widely-expected 0.25% cut by the bank’s Monetary Policy Committee as inflation fades.
The Bank of England (BoE) is expected to cut its base rate by 0.25% today as its Monetary Policy Committee (main image) shifts focus from cutting inflation to stimulating the flagging economy.
Economists quoted yesterday by both The Times and Sky News have said they expect the cut, a move that has been on the cards since inflation dropped from 2.6% to 2.5%.
This may sound like a small reduction, but inflation remains much lower than the 10% inflation seen during 2022/23, albeit above the BoE’s official 2% target.
The bank’s base rate has been at 4.75% since November last year, although mortgage rates have been softening for several months now in anticipation of further rate cuts and this, much to many estate agents’ relief, has helped boost demand.
Paul Hardy, MD of LSL Estate Agency Franchising says that, assuming the expected rate cut does take place that: “Although widely anticipated, this is good news for home buyers and anyone remortgaging in 2025.
“Every saving on a mortgage repayment helps confidence and this helps the property market.
“2024 was positive and 2025 has started well for our Franchise Partners with strong buyer interest and good sales levels. The drop in the interest rate will serve – in the short term at least – to reassure buyers’ and homeowners, especially as we head towards the 1st April Stamp Duty increases.
“However, for as long as there remains uncertainty over the stability of the economy, further interest rate drops in 2025 cannot be taken for granted. We will proceed with cautious optimism, hopeful that the market will continue positively.”
One area where the sales market has been more difficult is in London, and CamillaDell of Black Brick says that: “As the government attempts to repair the UK’s flagging economy London’s property market is – for the most part – treading water as 2025 begins.
“But there are signs of resilience, even some bright spots, and if, as predicted, the Bank of England cuts interest rates this month the spring market could mark a turning point.”
In London, the median property value rose by £1,400 last year, compared to an average of £2,400 across the UK
By Emma Magnus
It’s bad news for homeowners in London: house prices in the capital grew less than the national average last year, new research shows.
House price data from Zoopla shows that half of all UK homes increased in value last year, with the average property seeing a £2,400 uplift. In London, however, only 40 per cent of homes rose in value, with the median London property increasing by just £1,400.
London recorded the fourth-lowest house price growth of any region in the UK, after the east, south east and south west.
Zoopla’s research highlights a clear north-south divide, with 41 per cent of homes across the south of England falling in value by an average of £8,700. In the south, just 36 per cent of homeowners saw their property prices grow in 2024, compared to 62 per cent across northern England and Scotland.
This split reflects the underlying affordability of homes, with soaring mortgage rates and higher property prices in the south of England reducing buying power. In the north, where house prices are more affordable in comparison to incomes, there is more headroom for values to increase, despite higher borrowing costs.
House prices fall in prime central London
Across London, though, the picture is more varied. Homeowners in prime central London —the capital’s most expensive areas— saw the biggest drops in value. In Kensington and Chelsea, where property values fell more than anywhere else in the country, 72 per cent of homes fell in price, with an average reduction of £44,300.
This was followed by Westminster, where 67 per cent of homes declined in value, representing an average drop of £23,200. City of London and Camden saw similar slumps, with the average property value falling by £22,300 and £21,600 respectively.
According to buying agency Black Brick, the drop in prices across prime central London in 2024 is due to a combination of global and national uncertainties, high buying costs and a general air of caution. Forecasters for the coming year remain divided, with Savills anticipating that prices in prime central London will continue to drop by four per cent, and Knight Frank predicting growth of two per cent.
“Sellers are having to be very realistic and willing to sell at really big discounts in order to achieve a sale in the current market,” says Black Brick’s Camilla Dell. “London will come back and now is a great time to buy prime assets. We have been amazed by how much prime stock there is to choose from at the moment, and there are quite a few people who need to sell to the extent that they are willing to sell at a loss. Others have owned their properties a long time and so they are willing to be pragmatic about price.”
London’s winners
Some parts of London, however, fared better than the national average. Waltham Forest was the capital’s biggest winner, with 64 per cent of homes increasing in value —the eighth highest nationwide— and an average uplift of £8,700.
In fact, all five of the top-performing boroughs were in east London. Over 55 per cent of homes increased in value in Barking and Dagenham (+£5,000 on average), Hackney (+£12,900), Redbridge (+£6,800) and Havering (+£5,200).
With the exception of Hackney, these are among the most affordable places to buy a home in London: Barking and Dagenham has the capital’s lowest house prices, at an average of £336,000.
On the whole, more affordable boroughs —often in outer London— saw the biggest increases in value, while London’s most expensive areas experienced price drops.
Croydon, Greenwich and Enfield are three outliers in this respect, having lower property prices and yet still seeing the average house price fall by £900, £3,800 and £4,300 respectively. In Enfield, half of all properties decreased in value, while 29 per cent remained stable and 21 per cent increased.
“Inner London has the highest home values and higher borrowing costs have had a greater impact on buying power compared to outer London where home values are lower creating some headroom for small price increases,” says Zoopla’s executive director Richard Donnell.
“London has lagged behind the rest of the UK when it comes to house price growth since 2016 with the Brexit vote, pandemic and higher mortgage rates having a bigger impact on the London housing market. As incomes rise faster than house prices, affordability is slowly improving and there is growing value for money in the London housing market.”
Outside London
Outside of London, homeowners in the north west and north east of England saw the greatest rises in value, at an average of £4,400 and £4,300 on average. Berkhamsted, in the east of England; Carluke, Scotland and Waltham Forest recorded the country’s largest average increases in house prices, at £24,500, £8,900 and £8,700.
Conversely, Kensington and Chelsea, Broadstairs and Ferndown, all in the south of the country, experienced the greatest average decline in property prices, at £44,300, £15,300 and £14,400.
“The housing market returned to growth in 2024 but the pattern of home value changes across Britain is far from uniform,” says Donnell. “There is headroom for prices to increase in markets where housing is affordable compared to incomes which covers many parts of northern England and Scotland.
“In contrast, affordability is more of a constraint on price rises in southern England where the market continues to adjust to higher borrowing costs. Faster income growth is helping to repair affordability supporting moving decisions in 2025.”
But while house prices across the country are growing on the whole, experts predict that this may be short-lived, with upcoming changes to stamp duty.
“A slowdown in house price growth is in the post,” says Tom Bill, Knight Frank’s head of UK residential research.
“As sub-four per cent mortgage offers dry up and stamp duty rates increase in April, rising borrowing costs will suppress demand more noticeably from the second quarter of this year. As demand spreads into more affordable parts of the country, prices in these locations will remain relatively more buoyant.”
Camilla Dell is Managing Partner and founder of Black Brick Property Solutions LLP and has worked in the London property market since 2002. She is highly experienced in meeting the needs of demanding domestic and international property buyers.
During her career to date, Camilla worked for two of London’s largest and most successful estate agencies, Foxtons and Knight Frank, before setting up Black Brick in January 2007. Since then, Camilla has grown the firm from a two-person start-up to one of London’s largest, full service, independent buying consultancies. The Black Brick team collectively boasts over 100 years’ experience in the London property market and has successfully sourced and acquired more than £1.5 billion of residential property for private clients.
Camilla’s professional, energetic and tenacious approach to property finding, her total dedication to her clients’ needs and her expert negotiation skills have won her huge loyalty and trust amongst her clients who include some of the world’s most successful businessmen and entrepreneurs.
Can you share the story of what inspired you to found Black Brick, a leading and award-winning independent buying agent?
I started my career working for Foxtons in 2002. Jon Hunt the founder was a real inspiration to me. He is a self-made entrepreneur and grew the business from a single office start-up in Notting Hill to one of London’s most formidable and groundbreaking estate agencies, finally selling out for £360m. It was incredible to be part of that journey at that time and inspired me to go out and do my own thing. Jon and I are still in touch and friends to this day.
What would you say has been the most significant moment or milestone in your professional journey that has led to where you are today?
I love watching reality TV shows and in the early noughties, I was addicted to The Apprentice. I applied to go on series 2 and almost got chosen but didn’t quite make it. From over 100,000 applicants to be nearly chosen to go on the show really made me think about my future and gave me the confidence to start writing my business plan for Black Brick.
The London and UK property market is notoriously fast moving and competitive, so how on a day-to-day basis, do you continue to stay focused and ensure you best prioritise your time?
It’s too easy to get distracted in today’s modern world. There are so many channels these days all trying to grab your attention from Instagram, X and LinkedIn to the rise of the Whatsapp channels and of course email. At the end of the day what matters most is clients. Ensuring Black Brick has a steady flow of new clients and providing exceptional service to our existing clients is always the priority. I try not to pay too much attention to what others are doing and focus on attracting the best talent and refining our own systems and processes to stay ahead of the game.
Operating at the highest level often involves taking risks. But what role do you believe risk-taking plays in achieving success?
Setting up a business is risky. Walking away from a salary and the comfort of working for a firm takes guts. Risk-taking is essential if you want to create something. I believe in being realistic and taking calculated risks rather than risk for the sake of it.
When it comes to business, what is your leadership philosophy, and how do you use this to inspire and motivate those around you at Black Brick?
I have never believed in ruling from an ivory tower. We sit in an open-plan office. My team can approach me at any time for support. I believe in meritocracy. Reward big when it’s deserved. Party hard when things are going well and appreciate your team. My team know that I have their back and as a result, I have benefited from extreme loyalty with several members of my team having worked with me for over a decade.
Understanding and delivering against client property expectations must be incredibly rewarding but also challenging. What do believe is the secret to delivering the very best client experience?
Really taking the time to get to know a client, to listen, and to work out what makes them tick is crucial to being a good buying agent. Patience and perseverance are essential, along with the ability to get on with people from all walks of life. Being a buying agent is hard. You need to be analytical, and tenacious, have a high attention to detail, and be able to advise rather than sell and write reports to clients rather than just push a button and send a property brochure out. Estate agents often think they can be both. Sell and get retained by buyers, but the skills needed to be a great buying agent are hugely different to the skills needed to sell property.
We all know sometimes things don’t always go according to plan. Can you share a specific setback in your career, and how you utilised that experience to learn, grow and improve?
When I first set Black Brick up, I found recruiting hard. I recruited people I probably shouldn’t have. It’s a hard lesson, but over time you get to know what works well for your business and what doesn’t. I find recruiting talent much easier today than I did 18 years ago! I can tell within the first 5 minutes of an interview if someone is going to be right for us or not.
Entrepreneurs and founders are notorious for their long hours and facing challenges when it comes to balancing work and personal life. How do you manage this balance, and what strategies do you use to prevent burnout?
I have built a really strong support team around me both at work and at home that enables me to work hard but also maintain a good work-life balance. I am also a big believer in looking after yourself mentally and physically. I work out 4 hours a week and I do this during working hours, and I encourage my team to do the same. You can’t operate at the highest level if you aren’t looking after yourself.
What advice do you have for those aspiring to follow in your footsteps and enter the world of property search and finding? Are there key principles or lessons you wish you had known when starting out in this sector?
My biggest piece of advice to anyone looking at becoming a buying agent is to first learn the market. There are no shortcuts. Work for the best estate agency you can and get at least 5 years of solid experience under your belt. Advising buyers is impossible if you don’t first know the market.
Finally, when you reflect on your career in property search, and industry acknowledgement as one of the UK’s most influential and successful property professionals, what would you say has been your proudest moment to date?
There have been so many amazing moments from winning industry awards to presenting at prestigious events for the FT (Financial Times) and Bloomberg. I think my proudest moment was when the firm turned 10 years old. That felt like a real milestone. And the next proudest moment will be in 2 years time when we turn 20 years old – now that really will be something extraordinary to celebrate!
Will interest rates fall again? Will landlords continue to lump it? And what will the new stamp duty deadline mean?
By David Byers
So 2025 is here and, much to everyone’s shock, estate agents are actually talking up the prospect of selling houses.
Among a blizzard of predictions in the first week of the new year, one from the estate agency Winkworth stood out. It boldly forecast that its website traffic would be “up 400 per cent on January 2” compared with … Christmas Day.
But what are the really valuable predictions for 2025? We gazed into our crystal ball and this is what we saw.
Mortgages will dictate where’s hot (and not)
The key question is: how high will interest rates be, and will they constrain the market?
Interest rates fell glacially in 2024, dropping from 5.93 to 5.48 per cent for a two-year fixed rate and 5.55 to 5.25 for a five-year deal — the slow pace of change challenged the market. This gradual fall ground to a near-halt after the October 30 budget, which the Office for Budget Responsibility said could stoke inflation, leading the Bank of England’s monetary policy committee to hold its base rate at 4.75 per cent in December.
This week, hopes of an early boost for rates appeared to have been dampened by a rise in yields on UK government bonds, which are used by banks to price fixed-rate loans. The yield on the UK’s ten-year gilt has risen to 4.84 per cent, up from about 4.55 per cent at the start of January and its highest level since 2008. Some smaller and more specialist lenders which are more sensitive to changes in market interest rates have raised their rates. If this continues, mortgage brokers said other lenders could follow.
So what’s in store for 2025? According to 51 economists polled by The Times, things could turn out better than expected. They think that the Bank of England will be forced to cut rates at least four times this year to boost flagging economic growth — an improvement on the previous widespread predictions of two cuts.
Whether this comes to pass will have a huge impact on the market, particularly in the southwest, southeast, London and east, where homes are more expensive. If rates remain sticky, buyers will continue to delay putting in offers, or do so at levels that sellers think are derisory.
It’s a scenario summarised by Nationwide’s analysis of 2024 released last week. It showed that the UK average house price went up by 4.7 per cent in 2024 (the strongest rate of annual inflation since October 2022), but it also showed a geographically divided market. The largest percentage rise was in Northern Ireland (7.1 per cent), followed by the north (5.9 per cent) and the West Midlands (4.7 per cent). Areas where prices are more expensive were by far the most sluggish. East Anglia, for example, had a 0.5 per cent rise, London 2 per cent and the southeast 2.3 per cent.
Data released last week by Halifax showed that the ten areas with biggest growth in 2024 were mostly towns with lower house prices, such as Stoke-on-Trent (17 per cent growth), Slough (15 per cent) and Oldham (15 per cent).
The 10 UK areas with the greatest house price growth in 2024
With mortgage rates predicted to remain stubbornly high, sellers will need to price their properties carefully in 2025. Homes last year were most in demand in places with the cheapest prices, particularly for landlords who faced higher taxes and bought in high-yield areas
Table with 4 columns and 10 rows.
Stoke-On-Trent
£227,002
£33,339
17
Slough
£497,704
£64,510
15
Oldham
£250,546
£31,951
15
Bradford
£226,261
£26,168
13
Bolton
£252,070
£28,839
13
Barnsley
£224,886
£25,161
13
Wolverhampton
£278,083
£30,680
12
Doncaster
£228,040
£23,669
12
Dunfermline
£230,379
£22,365
11
Hamilton
£229,835
£21,474
10
Unsurprisingly, eight of the ten weakest areas for price growth were in London or the southeast, such as Ealing, Southwark and Kingston upon Thames.
The mortgage market will also influence what kind of homes sell well in 2025. During the pandemic, detached homes were hot, but that trend reversed last year, as buyers shunned pricier properties. Terraced houses increased in value by 4.4 per cent in 2024 and flats by 4 per cent, according to Nationwide. Semi-detached properties recorded a 3.4 per cent annual increase and detached properties rose by 3.2 per cent.
The lesson of this story is that if you’re selling a larger home, particularly in the southeast, buyers will continue to be very careful over price. Use your common sense — if you think your home may be overpriced, set your sights a little lower.
Our mortgage prediction: New rates will average just above 4 per cent by the end of 2025 (with a 25 deposit).
There’s no rush to join the stamp duty splurge
One thing that excites estate agents is a stamp duty deadline, as it usually leads to a herd of bargain-hunters stampeding towards their windows.
From April 1 the tax will kick in at a purchase price of £300,000 (rather than £425,000) for first-time buyers. For those who are not first-time buyers the threshold will go down to £125,000 from £250,000.
Data from the property portal Rightmove suggests that from April 1 only 8 per cent of homes in London will not incur stamp duty for first-time buyers, while 24 per cent of homes in the southeast would be stamp duty-free. That is in stark contrast with the northeast, where 73 per cent of homes will still be exempt from the tax.
Rightmove said demand from buyers in London had already been rising significantly towards the end of 2024 as people rushed to complete purchases before the deadline — stamp duty cliff edges often cause buyers to act recklessly. The discount introduced during the pandemic had been due to end on March 31, 2021. The number of sales from February to March that year leapt from 143,460 to 177,300. Then in June, just before the extended July 1 deadline when the tax-free threshold really did reduce, the number jumped from 114,800 to 204,370, according to the estate agency Savills.
Robert Gardner, the chief economist at Nationwide, said the spring deadline this year was “likely to generate volatility, as buyers bring forward their purchases to avoid the additional tax”.
However, buyers may discover that a stamp duty holiday is a con. These periods of tax discounts almost always drive property prices up so that, in the past, many bargain-hunters have ended up paying more for properties than any relative saving made on stamp duty. Ray Boulger from the mortgage broker John Charcol said on a typical £500,000 property, the extra stamp duty would make up only 0.5 per cent of the purchase price and so even a small decline in prices after April 1 would make rushing to beat the March 31 deadline a false economy.
Our house price prediction: UK-wide growth of 4 per cent. Biggest growth in northwest (5 per cent), weakest in London (3 per cent).
Dominant first-time buyers may cash in on landlords selling up
A stamp duty hike and high mortgage rates made 2024 the year of the disaffected landlord — this is set to continue. On October 31, the stamp duty surcharge paid by buyers of second homes went up to 5 per cent. A landlord or second-homeowner buying a property worth £500,000 faced an additional bill of £10,000 overnight, from £27,500 to £37,500.
Would-be landlords were also buffeted by high mortgage rates, with the average five-year rate at 5.46 per cent compared with 5.91 per cent a year ago, according to the website Moneyfacts Compare.
Zoopla suggested that many landlords were selling off their properties, particularly in expensive areas of London, with 32 per cent of all homes up for sale in WC postcodes having been rented out in the past four years. Across the country, it’s 12 per cent. Expect the number of landlord sales, particularly in wealthy areas, to grow in 2025.
One of the government’s aims is to free up room for first-time buyers, who make up 49 per cent of all purchasers nationally — one of the highest proportions ever — and, in some areas, like Manchester (75 per cent) and Slough (73 per cent), much more.
First-time buyers cashing in on landlord sales will be a big story in 2025. The estate agency Hamptons said in 2024 that the proportion of properties sold by landlords which were bought by first-time buyers was at its highest level — 35 per cent, up from 16 per cent in 2016.
First-timers also benefited from an unprecedented wealth transfer from their parents, a trend that will continue. Gifts and loans from the Bank of Mum and Dad totalled £9.3 billion in 2024.
Our first-timer prediction: The Bank of Mum and Dad will hand a record £10bn to their kids this year.
A mixed outlook for renters
Radical renters’ rights which are likely to come into law this year or next promise a ban on “no fault” evictions and will force landlords to improve the energy efficiency of rental homes. The flipside, if you believe the National Residential Landlords Association, is that the tax clampdowns will result in a shortage of rental properties as landlords sell up.
Rightmove reported in December that each available rental property was attracting 11 inquiries, compared with six in 2019. However, more positively, rental costs on newly let properties in Britain rose by 2.6 per cent over the year to November, the lowest annual increase since November 2020 (2.4 per cent).
Our rent prediction: 3.7 per cent UK-wide rise — but just 1.5 pr cent in London, where tenants have already absorbed huge increases.
Trouble in (prime) paradise?
For wealthier buyers, tax headwinds, such as the introduction of 20 per cent VAT on private school fees, will constrain them, although they won’t be too concerned about mortgages.
One other disincentive will be a raft of taxes for holiday homeowners, which contributed to a sharp fall in demand for pricey country houses in 2024. Agents also reported a growing sell-off of second homes in Cornwall, Norfolk and Dorset due to plans for massive council tax increases that are due in April.
Plus, for the richest buyers, many who come from overseas, Labour’s decision to end non-dom status has led to a near-collapse in parts of the super-prime property market in London.
An analysis by Beauchamp Estates using the LonRes transaction database, showed a sharp fall in sales of homes worth more than £15 million last year. A total of 40 such homes sold in 2024, compared with 54 the year before. The total value of the homes that did sell fell 34 per cent to £856.5 million, compared with £1.3 billion in 2023.
Those selling London and home counties properties in the £1.5 million to £2 million bracket may have more luck, however. Because of the shortage of quality family homes in affluent suburbs, agents say the right property of this type could sell swiftly — particularly if buyers are priced out of private schools in larger numbers and looking nearer to good state schools. “Last year we saw huge competition in the market up to £2m in four-bedroom Victorian terraces in West Hampstead and Fulham,” says Camilla Dell of the agency Black Brick.
Also in 2025, there may be an influx of liberal Americans fleeing due to the Donald Trump administration. Our prime prediction: A 5 per cent fall in prime central London, as richer buyers shun higher taxes, but down by 1 per cent in regional markets.
‘We have been amazed by how much prime stock there is to choose from at the moment,’ says PCL acquisition firm, which has just secured an apartment in Kensington for less than half its original £30mn asking.
High-end stock continues to pile up across the prime postcodes, and Black Brick says buyers remain “extremely price sensitive”. Some eye-popping discounts are being secured as a result.
The firm is currently acting for an overseas buyer who is in the process of snapping up a six-bed flat in Kensington which originally went on sale for an “ambitious” £30mn. With no takers the owner gradually dropped the price down to a more reasonable £18m. An offer has just been accepted at £14.55mn, or £2,500 per square foot, less than half the original price. The team describes this as “outstanding value considering the property’s quality and location”.
“We have seen opportunistic overseas buyers come to the market who are looking for a deal, because they are obviously out there at the moment,” explained managing partner Camilla Dell.
“London will come back and now is a great time to buy prime assets. We have been amazed by how much prime stock there is to choose from at the moment, and there are quite a few people who need to sell to the extent that they are willing to sell at a loss. Others have owned their properties a long time and so they are willing to be pragmatic about price.”
Tom Kain, partner, said many of the vendors coming to the market have been waiting “literally years” for a good time to sell – from Brexit to the pandemic, through the outbreak of war in Europe and the Middle East, the cost of living crisis, and the 2024 General Election: “They have got to the point now where they can’t just sit it out any longer”.
Dell predicts house hunters will have a “solid window of opportunity” before prices start to increase in 2026: “This is the moment when the really smart money is buying”.
“I have never seen such a huge variation between the main forecasts,” she added. “Usually, the main estate agency forecasts are less than a point apart, but this time the differences are huge. My reading is that none of the agents really know where the market is headed next year and beyond.”
The firm suspects that Savills’ more conservative view of the potential for price growth will be closest to the mark: “Sellers are having to be very realistic and willing to sell at really big discounts in order to achieve a sale in the current market,” said Dell, but caveats that the reality is likely to be “far more complicated and nuanced” with certain property types in certain locations selling strongly and others continuing to dive: “Forecasts are not gospel, and London is a very complex market. There will be different outcomes in different parts of the capital. We continue to see a lack of supply for best-in-class family homes with gardens and parking in the most desirable streets of prime London, around Notting Hill for example, where bargain hunters may be disappointed.”
Other key trends flagged for 2025 include: heightened competition for big-ticket rental homes, as international HNWIs navigate the new non-dom rules; and further growth in off-market selling – it’s estimated that 50-60% of PCL properties are now discreetly marketed without ever hitting the portals. “I am on perhaps 50 WhatsApp chats to keep up with off market sales,” added Dell.
