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A depressed prime property market and a new tax-free regime have made buying in London more attractive to wealthy United Arab Emirates residents over the past year, according to their advisers.
Property agents and tax lawyers told the Financial Times that purchasers included UAE nationals and long-term UK expats, with some looking to relocate and others wanting a foothold in London at decade-low prices.
“The uptick in interest from the Middle East has been quite marked in the last three or four months,” said James Forbes, co-founder of Forbes Gilbert-Green, a London property advisory firm. “There’s an obvious increase in activity. London is looking cheaper than it was.”
Prime property in the UK capital has been in a slump over the past decade in part because of higher housing levies, uncertainty over Brexit and non-dom tax changes. House prices in Kensington and Chelsea fell to their lowest since 2013 in May 2025.
In her first Budget last October, chancellor Rachel Reeves abolished non-dom status and initiated a tax regime under which rich foreign arrivals or those returning to the UK after a decade overseas do not pay tax on their foreign income and gains (FIG) for four years.
A tax lawyer who specialises in the Middle East said: “I’ve got one British expat client who’s been in Dubai for a long time and he is now moving back to the UK and taking advantage of the new four-year FIG regime.”
Reeves was told by the Office for Budget Responsibility, the independent fiscal watchdog, to expect 25 per cent of non-doms with trusts to quit the UK in response to the crackdown on their tax status, which began under the previous Conservative government.
Stuart Bailey, head of prime central London sales at estate agent Knight Frank, said: “If you are from the UAE, for example, and of a generation that has not yet bought in London, both the suppressed pricing and the four-year FIG regime present a good time to buy.”
“Non-doms being pushed out of London certainly doesn’t benefit the wider economy, or the government with reduced stamp duty being collected, but it works well for opportunistic buyers, with less competition all the better,” he added.
Property values in Dubai have soared in recent years, with average prices per square foot up 67 per cent since July 2019, according to data analytics group Reidin. Luxury properties have gained particularly quickly, giving some homeowners in the UAE’s biggest city a chance to cash in.
UAE nationals accounted for 3 per cent of overseas buyers in prime central London in the year to July, up from 0.6 per cent the previous year, according to Knight Frank, which declined to provide absolute numbers.
There are about 1mn Emirati nationals, according to official figures, and prime London sales comprise a small part of the overall residential property market.
Liza-Jane Kelly, head of London residential at estate agent Savills, said she had found homes for two returning British expats in the past three months. Both of them wanted UK education for their children, and one cited tax reasons.
“One said they’ve been in Dubai for 15 years, and it’s changed, and it’s got a lot busier,” Kelly said. The returnees bought in Chelsea and Knightsbridge, respectively, spending between £4mn and £6.5mn, she said.
Becky Fatemi, executive partner at Sotheby’s UK International, said recent changes standardising UAE school holidays made spending family time in the UK easier, with some families looking to split the year between the UAE and Europe.
Despite July and August typically being quiet months, Fatemi said her company had experienced its busiest summer in three years, with buyers taking advantage of the dip in values to snap up sites that historically would not have come to market.
Interest in UK property goes beyond homes: Middle East family offices and wealthy individuals have invested £245mn in UK commercial real estate so far this year, compared with just £25mn for all of 2024, according to Knight Frank.
Reeves has been told by Treasury officials that fears of a mass non-dom exodus have been overstated and that there are encouraging signs that some wealthy people are deciding to move from Dubai to London. But there is no guarantee new arrivals will settle for the long term.
The Treasury said: “The UK remains a highly attractive place to live and invest. Our main capital gains tax rate is lower than any other G7 European country and our new residence-based regime is simpler and more attractive than the previous one.”
Additional reporting by Chloe Cornish in Dubai