A rising number of wealthy Americans are purchasing luxury homes in London as they look to distance themselves from Donald Trump’s America.

Research from Knight Frank reveals that in the final quarter of 2024, US buyers made up 11.6% of all foreign property purchases in central London, overtaking Chinese buyers, who accounted for 8.1%.

Among those investing in high-end London real estate was American fashion designer Tom Ford, who reportedly spent around £80 million on a Chelsea mansion in November.

The surge in affluent US buyers coincides with a record-breaking increase in American applications for UK citizenship, according to the Home Office. Trump’s return to the White House is believed to be a key driver of this trend. Over 6,100 people applied for British citizenship last year, with applications spiking 40% year-on-year in the last three months of 2024—coinciding with Trump’s re-election.

Knight Frank also noted that the strength of the US dollar played a role in attracting buyers, as those purchasing property in prime London locations benefited from a 38% discount compared to a decade ago.

This trend emerges against a backdrop of falling property prices in central London, with average values in prime neighbourhoods declining by 1.1% in the year leading up to February and transaction volumes dropping by 5%.

Tom Bill, head of UK residential research at Knight Frank, suggested that if the UK manages to avoid the fallout from a potential trade war between the US and the EU, it could position itself as an appealing destination for international investment.

He also highlighted that the Chancellor’s upcoming spring statement presents an opportunity to adopt a more investor-friendly stance.

However, Mr. Bill warned that now may not be the ideal moment to overhaul the UK’s non-dom tax regime in a way that makes it less competitive.

He pointed out that as the Finance Bill nears completion in Parliament, the government has shown no indication of considering an Italian-style flat tax or addressing investor concerns about extending UK inheritance tax to overseas assets.

While demand for prime London real estate is not solely dependent on non-domiciled residents, Mr. Bill argued that the UK could be sending the wrong message to global investors at a critical time.