HMRC data shows a decline in UK residential property disposals by foreign nationals, with high-value transactions also falling
The number of UK residential properties sold by overseas private individuals fell in the year to 5 April 2026, according to research by Bowmore Wealth Group.
HMRC data provided to Bowmore shows 16,520 properties were disposed of by overseas individuals during the period, down from 18,100 the previous year. Sales of properties valued above £5 million also declined, with 70 high-net-worth overseas individuals selling such assets compared with 80 in the prior year.
Bowmore said the initial surge in disposals may have been linked to the abolition of non-domicile tax status, announced in the Autumn Budget 2024, but noted that the pace of selling appears to have eased.
The wealth management and financial planning firm also pointed to a broader deterioration in the attractiveness of UK residential property as an investment. From 2027, income from property will be taxed at a rate two percentage points higher for investors. Earlier reforms already prevent landlords from offsetting mortgage interest against rental income, while the Renters' Rights Act has further constrained the sector by restricting tenancy terminations and limiting rent increases.
Bowmore additionally cited research from the Adam Smith Institute indicating that the number of individuals in the UK with a net worth of £1 million or more has fallen 7% since 2024, reaching its lowest level since the Global Financial Crisis of 2008.
"It appears to be a period of readjustment for UK and overseas owners of UK property," said David Floyd (pictured right), head of private clients at Bowmore Financial Planning. "Residential property, as an asset class, is having to face a number of challenges.
"The Renters' Rights Act is just the latest catalyst that encouraged investors to reduce their exposure to residential property in favour of equities or short-term bonds."
Floyd added that net rental yields in London stand at around 2%, and that UK house prices have stagnated or fallen in real terms over the past decade. "When you can get a risk free 4.6% on a five-year government bond it makes the net yields on residential property look very low," he said. "Those low net yields on buy-to-let property were justifiable when property prices were roaring away but not now."
He also noted the administrative demands of landlordship relative to other investment vehicles. "The administrative burden of being a landlord, as opposed to being a stock market investor, have always been quite onerous and the new Renters' Rights Act has added an extra level of uncertainty into being a landlord," Floyd said.
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