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Why Buying London Property Continues to Attract Global Interest

25.03.25

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The allure of London’s property market and the enviable lifestyle it offers has long been an attraction for foreign homebuyers and investors, particularly those from the Hong Kong and Gulf Cooperation Council (GCC) countries such as Saudi Arabia and Qatar.

Despite various political shifts and economic challenges in recent years —ranging from a new Labour Government to new policies for foreign buyers — the appeal of buying London property continues to draw many internationals to the London property market.

We take a look at what keeps Prime London property at the forefront of international buyers’ minds.

The London Property Market

Buying London property remains an attractive option due to its well-known resilience to economic pressure and its comparatively high long-term value and growth potential. Whether it’s residential or commercial properties, London has proven to be a safe investment destination, particularly when compared to the likes of the USA and the Hong Kong markets.

After a challenging few years for the UK’s property market overall, industry forecasts predict sustained upwards growth for property prices – particularly in Prime Central London – supported by falling interest rates and more affordability for homebuyers, both domestically and internationally.

Industry experts agree that cumulative growth in London will start moderately but is set to show its trademark resilience and outperform the rest of the UK market over the next five years. KnightFrank’s latest forecasts indicate that London’s property price growth will grow 2% over the next 12 months. By 2026, London is expected to surpass the overall UK with 3.5% growth compared to the UK’s 3.0% and is expected to enjoy 21.6% growth in property prices by 2029 compared to the UK’s 19.3%.

Read more about our predictions for the London Property market here.

Who’s Buying London Property?

London’s status as a global financial hub, a thriving cultural capital, and a desirable location for wealthy individuals continues to cement its appeal within the international homebuyer market. Many foreign buyers are also drawn to London’s historical significance and its global influence – particularly within the financial and business sectors.

Recent research by Benham and Reeves obtained from Land Registry data revealed that, despite a huge shift in the UK’s political landscape and new tax changes for international residents brought forward by the new Labour government; foreign homeowners accounted for the ownership of approximately 190,000 properties in England and Wales in 2024 – a 2.6% increase from the previous year. The majority of these properties were based in London and the South East, testament to the attractiveness of the Capital and its commuter towns on an international scale.

The research highlighted the ongoing demand from Hong Kong buyers, which is closely tied to the British Nationals Overseas Visa launched in 2021, which had increased 5.7% year-on-year. Similarly, there was a 5.5% year-on-year increase in homebuyers from the USA and a 12.9% rise in Chinese homebuyers – the largest among the top 20 nations.

It is evident that, because demand from London’s prime property comes from a diverse range of international buyers, changes to stamp duty and non-dom taxes outlined in the Autumn Budget have had little impact on the allure of buying London property.

The Appeal of Buying London Property

London’s appeal lies in its strategic location, a stable legal framework, and its world-renowned financial and education sectors. Buying property in London also holds a unique status—something that many wealthy individuals consider a symbol of prestige and security.

The property in central London, especially apartments in affluent areas like Mayfair, Knightsbridge, and the Royal Borough of Kensington and Chelsea, offers:

Strategic Location: As an international city with excellent connectivity via Heathrow – the UK’s largest and Europe’s second busiest airport – road and rail, buying property in London allows working professionals easy access to major global markets and forms a useful “base” for international work commitments.

Luxury Appeal: Buying property in London continues to attract high-net-worth individuals, including foreign buyers looking for prestigious homes in iconic locations. London’s luxury lifestyle offering is unmatched, with world class brands, 96 Michelin stars across 74 restaurants and enviable retail, leisure and cultural pursuits, as well as a thriving financial business centre.

World-Class Infrastructure: London’s advanced infrastructure, including The London Underground and other forms of public transport, provide excellent connectivity and convenience to residents.

High Capital Appreciation Potential: London property has consistently returned strong long-term growth, making it a reliable option for both buyers and investors seeking capital gains. Since 2004, the average property price in London has increased by 122.7% outperforming the 92.5% increase for England as a whole, according to Land Registry data.

Consistent Rental Demand and High Yields: London has a diverse and growing population, including students, professionals, and international expats, which creates a steady demand for rental properties.

Attractive Returns on Investment: With a strong rental market and comparatively high property values versus the rest of the UK, investors can expect competitive returns, especially in prime locations like Kensington.

Rebecca Thomson, Group Sales Director at SevenCapital says:

“London’s multifaceted offering solidifies its place as one of the most attractive and prestigious cities in the world to buy property – holding high appeal to buyers both domestically and internationally.

We’ve seen growing demand from overseas despite a changing political landscape, with the likes of Hong Kong, the USA and those within the GCC region continuing to show huge interest in the Capital. Likewise, demand for high-end city centre apartments is surging as more and more buyers prioritise proximity to work, transport connections, entertainment, and local conveniences.

As always, the unwavering appeal of London property has showcased the market’s trademark resilience to wider challenges, and we anticipate the Prime Central London market to outperform the rest of the UK over the next five years in terms of long-term growth.”

Trademark Resilience

Despite political economic changes in the UK, buying property in London remains an attractive prospect for individuals based internationally, particularly those looking to diversify their property portfolios or looking for a UK base in the Capital. We expect this to continue as London proves its strength and resilience throughout 2025 and beyond.

London’s blend of stability, potential for growth, and prestige continues to make it a highly sought-after location for high-net-worth individuals. While there are political uncertainties, the fundamentals of London’s property market—its global reputation, legal protections, and diverse investment options—ensure it remains a key player on the international property stage.

In fact, the current political climate and London’s current property market might even present more opportunities for homebuyers to secure high-value assets at competitive prices, making the city’s property market as attractive as ever.