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Real estate investment in Great Britain

Foreigners can buy, lease and sell real estate without restrictions in the UK.

Statistics confirm the liquidity of investments: every quarter, residential real estate prices grow by an average of 1.3%. Five years ago, an apartment of 100 m² cost an average of €342,000, and today it is sold for €431,000.

€4,310 Average price per 1 m²
of housing in the UK
1,3% Average price per 1 m²
increase per quarter
0,05—13,05% Buyers’ related expenses,
of the transaction amount

Cost of a 3-bedroom apartment in the UK

€20 million

Penthouse in London

€5 million

Apartment in London

€500,000

Apartment in a major city
such as Manchester

What do investors buy?

The most expensive properties are in London and the surrounding counties — Surrey and Sussex.

Apartments

  • penthouses
  • duplexes
  • apartments

Houses

  • townhouses
  • mansions
  • historic estates

UK residence permit or citizenship by real estate investment

Obtaining a UK residence permit or citizenship is not connected with purchasing real estate.

A residence permit obliges the holder to live in the country for at least 183 days a year and not leave the UK for more than 90 days. British residents can’t visit other countries visa-free.

After six years of living in the UK, an investor can apply for citizenship.

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Taxes and associated costs

Purchase
Ownership
Sale

Property buyers pay stamp duty and government fees. Associated costs range between 0.55% and 13.05% of the purchase agreement value.

When buying an apartment worth €4 mln, the investor will spend €4.552 mln, including additional costs.

0.05—13.05% Of the contract value are related costs for the purchase of housing in the UK
Purchase expenses
Stamp duty

Depends on the transaction amount

0—13%
Registration fee
0.05%
Notarial and legal support of the transaction
0.5—1%

Taxes

Owners pay a municipal property tax. The municipality sets the tax amount depending on the cadastral property value. In London, for example, the rate depends on the district.

€5,300 Approximate annual costs for
maintenance of an apartment

Communal payments

Property owners pay an income tax of 20% on their rental income.

Utilities. Water, electricity, and gas are paid for by meters. Housing is often heated with gas fireplaces or boilers. Some apartments have a wood-burning fireplace.

If an apartment owner has a long-term leasehold right, they pay additional rent to the land owner. The contract determines the fee amount. The approximate range is between €20 and €700 per year.

The building maintenance fee, which includes the elevator, cleaning, repairs, and concierge, depends on the building.

Internet, TV, and telephone connection costs €30 to €53 per month, depending on the tariff and locality.

Electricity, gas, water, heating, and garbage collection
€80—350 

per month

Building maintenance

Cleaning, repairs, and concierge

€400—5,000 

per month

A seller of real estate in the UK pays a capital gains tax of 18% to 28% on the difference between the sale and purchase prices. The tax rate depends on the amount of capital gain.

The following are exempt from paying the tax:

  • non-residents — those who live in the UK for less than 183 days a year;
  • residents who have sold their primary residence.

If the owner sells the property through an agency, they pay a commission of 2% to 4% of the sale price.

Capital gains tax

Paid on the difference between the sale and purchase prices

18—28%
Agency fee

Depends on the real estate agency,
VAT included

2.35—4.11%

Frequently asked questions

Can foreigners buy property in the UK?

Yes, foreigners with or without a residence permit can purchase real estate in the UK. There are no restrictions.

How much does a house cost in Great Britain?

Property prices in the UK are growing by an average of 1б3% every quarter. The average housing cost is €4,310 per 1 m².

Can I live in the UK if I buy a property?

You can buy property as a foreigner, but it won’t give you a residential permit. Obtaining a UK residence permit or citizenship is not connected with purchasing real estate.

UK expats can obtain a residence permit for investment in the economy
from £2,000,000, or about €2,350,000. These cannot be investments in real estate or in companies whose activities are related to investments in real estate.

Does the UK have real estate taxes?

Property owners in the UK pay a municipal property tax depending on the cadastral property value.

A seller of real estate in the UK pays a capital gains tax of 18%—28% on the difference between the sale and purchase prices. There are exemptions for:

  • non-residents who live in the UK for less than 183 days a year;
  • residents who have sold their primary residence.