Singapore luxury homes set to benefit from UK tax change

The change will affect around 74,000 non-domiciled residents in the UK.

A potential change to the tax status of around 74,000 non-domiciled (non-dom) residents in the United Kingdom could benefit Singapore's residential luxury market, an expert said. 

The UK government plans to abolish the non-dom tax status effective  6 April 2025, meaning that non-dom residents will be subject to UK tax on all foreign income and gains.

According to Huttons, Singapore is among the countries being considered by these ultra-wealthy foreign residents looking to relocate abroad to safeguard their assets, alongside Dubai, Italy, and Switzerland.

“These ultra-wealthy foreign residents might set up family offices, apply for citizenship or invest in real estate,” Huttons said.

In Q3, Huttons said many newly converted Permanent Residents (PRs) and naturalized citizens inquired about luxury non-landed homes.

“The high 60% Additional Buyer’s Stamp Duty on foreigners in Apr 2023 has led to more foreigners applying for PRs and citizenship. Many of them bought a luxury non-landed home upon approval of their PR or citizenship,” Huttons said.

In Q3, 55 luxury non-landed homes exchanged hands for $407.7m. Compared to the previous quarter, these numbers were 3.5% QoQ and 15.5% QoQ lower.

Year-on-year, however, Q324 figures were higher. Luxury home rents also rose, likely due to the flight to safety by ultra-high-net-worth individuals (UNHNWIs) amidst global uncertainties and geopolitical tensions.

Overall luxury non-landed home rents increased by 2.7% QoQ, reaching $14,932 monthly.

Meanwhile, Good Class Bungalow (GCB) transactions also rose with 12 sold, up from the eight recorded in Q2.

The total value of GCBs sold in Q3  was $541.2m, up 80.9% QoQ.

In Q4, Huttons anticipates higher sales and rental activity in the luxury non-landed homes market and continued interest in the GDB market as price expectations align.