Millionaires flee London and put homes up for rent

London’s luxury property sector is undergoing a dramatic transformation, driven by an exodus of wealthy residents ahead of April’s abolition of the non-dom tax regime.

As high net worth (HNW) individuals depart, many are choosing to rent out their prestigious homes rather than sell.

And that, says Garrington Asset Management, is sparking a sharp rise in rents across the capital’s most exclusive postcodes.

It adds that the government’s policy shift prompted around 10,800 millionaires to leave the UK last year – a figure surpassed only by China.

However, rather than offloading their properties, many are opting to retain these assets, capitalising on the flourishing rental market.

Much-loved asset

A director of the firm, Pippa Mitchell, said: “The dynamics driving London’s prime property market are being redrawn, but for those who understand them and think on a generational, rather than short–term, timeline, the capital remains one of the world’s most resilient and rewarding locations for property investment.

“That’s why many of the HNW owners navigating Britain’s shifting tax sands are increasingly opting to focus on lettings rather than sales.”

She adds: “On an emotional level, this is about those who’ve acquired a rare, irreplaceable property in the capital keeping a home they love.

“And on a pragmatic level, a well-managed property asset will deliver consistent income year after year yet can also be a home to live in whenever you wish.”

Prime rents grew

According to LonRes, rents for flats in prime Central London grew by 7.9% in the first quarter of 2025 compared to the previous three months.

This surge has pushed average rents 11.3% higher than a year ago, reflecting a robust demand for premium lettings.

Meanwhile, the sales market for high-end homes remains sluggish, with Land Registry data indicating a 1.1% drop in average London house prices from January to February 2025.

The supply of properties priced above £5 million has also swelled, with 30% more such homes listed in February 2025 compared to the same period last year.

There was also a 21.1% increase in total £5m+ listings annually.

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