The UK’s residential and commercial property markets are predicted to see an influx of US investors after President Donald Trump’s return to the White House.
International buyers have long been attracted to the UK property market thanks to factors such as the country’s stable economy and political situation, strong long-term house price growth, and ease of access to the sector compared with other countries.
Investors from dollar-pegged currencies in particular have been drawn to UK property in recent years due to the pound’s falling value against the dollar. This includes buyers from places like the UAE, Saudi Arabia and Qatar, as well as Hong Kong and China, while US investors also make up a solid proportion of foreign buyers.
Donald Trump’s victory in the US elections has also been linked to rising interest in the UK housing market from US investors, although interest in the sector was noted before this by the likes of property agent Savills, which recorded that US buyers were the most prolific users of its site from outside the UK, and made up 14% of all transactions by overseas buyers.
Trump’s polarizing effect
The new president is of course a very divisive figure globally, and even in the build up to the election his potential to win led to varying reactions from US investors – divided between those who were rooting for a Republican victory, and those who were horrified by it.
Speaking on the behavior of US investors over the course of the past year, buying agent Liam Monaghan of LCP Private Office said: “The US election is a polarizing event and therefore has driven some US clients to think about their worldwide holdings carefully. It is sensible to have a foothold in both camps as they monitor the political landscape and financial markets.
With the new president now at the helm, and already issuing several controversial directives, there is scope for even more US investors to look across the pond for both political and economic stability, and a potentially more welcoming environment since UK Chancellor Rachel Reeves announced plans to soften upcoming non-dom tax changes.
James Gow, head of London residential sales for Strutt & Parker, is one agent expecting a rise in US investors off the back of the election outcome. “Trump is such a polarizing figure that there will be some wealthy Americans who will just think, ‘I do not agree with his rhetoric and I just cannot be a part of it,'” he said.
What are US investors looking for?
A high proportion of US investors in UK are high-net-worth individuals looking for a foothold in the country, whether that be purely for investment purposes, or to take advantage of the UK’s outstanding reputation as an education center.
London remains one of the most popular destinations for US investors, although other major cities such as Manchester and Birmingham have also attracted a higher level of interest in recent years. The property markets of the UK’s regional cities have been outperforming the London market, from both a capital growth and a rental value perspective.
New-build schemes “with all amenities on site” are another popular target among US investors, notes LCP’s Monaghan.
According to Daniel Austin, CEO and co-founder at ASK Partners, prime areas in London such as Mayfair or Belgravia “are transforming into ‘Manhattan-on-Thames’, attracting wealthy Americans capitalizing on favorable exchange rates and the capital’s prestige”.
He added: “Savills data highlights North American retail brands expanding along Oxford Street, underscoring transatlantic appetite for UK investments. At the same time, Labour Party signals, including Rachel Reeves’ softened stance on non-dom tax reforms, aim to retain affluent residents and could further boost demand.
“While higher borrowing costs may curb broader growth, persistent supply constraints and emerging trends like co-living schemes ensure the UK market remains a compelling investment destination. Funds and property investment vehicles are well-positioned to capitalise on these opportunities.”