KIRE Insights: An American Buyer's Guide to Purchasing Property in Prime London
By Charlotte Rechtshaffen
The prime London property market has long attracted buyers from around the world, with Americans representing an increasingly significant share of international demand. So far in 2026, American buyers have accounted for 30% of transactions above £5 million in Prime Central London, up from 20% in 2025.[1] The capital’s enduring status as a global centre for business and culture, relative political and economic stability, and the strength of the U.S. dollar, alongside a recent softening in prices compared with previous years,[2] have made prime London an increasingly appealing destination for those looking to relocate, invest, or purchase a pied-à-terre.
Despite the shared language, the process of buying property in London differs in several important respects from the United States. Understanding these differences from the outset can help buyers approach the process with greater confidence.
From Accepted Offer to Completion
One of the biggest adjustments for North American buyers is the length and structure of the purchasing process. In the United States, once an offer is accepted, both parties sign a purchase agreement, making the offer legally binding. Deposits are typically held in escrow while inspections are carried out, financing is secured, and any remaining conditions of the sale are satisfied before closing. On average, this process takes just 30-45 days.[3]
In the United Kingdom, once a sale is agreed, solicitors are instructed and begin the conveyancing process, which can be lengthy and complex. In this phase, surveys and local authority searches are conducted, mortgage arrangements are finalized, and any complications are ironed out. This process can take several months, culminating in the exchange of contracts and payment of the buyer's deposit, which is typically 10%, but can be negotiated. At that point, the transaction becomes legally binding.
Until contracts are exchanged, either party is generally free to withdraw without penalty (aside from fees for professional services already rendered), and it is at this stage that many agreed deals fall through. Delays caused by legal enquiries, financing, surveys or chains are not uncommon, and sellers may accept a higher offer before exchange, a practice known as gazumping. Once contracts have been exchanged, however, the path to completion is usually straightforward, with the remaining time used to transfer funds, arrange buildings insurance, and prepare for the move.
While it is possible to exchange and complete in a matter of days, this is extremely rare and typically requires a chain-free, all-cash transaction, along with significant preparation from both parties' solicitors to ensure that searches, surveys and documentation are completed in advance.[4] More often, the distance from agreeing a sale to completion falls between two and six months.
Understanding Ownership Structures
Another important distinction between the British and American property markets is the system of freehold and leasehold ownership. With a freehold, you own both the property and the land on which it stands outright. A leasehold, by contrast, gives you the right to occupy a property for a fixed term, typically between 99 and 999 years, after which the lease reverts to the freeholder unless it has been extended.
A leasehold is a diminishing asset because its term shortens over time. This is particularly important when the term falls below 80 years, as it becomes more difficult to secure a mortgage and the cost of extending the lease increases significantly. Under the current system, marriage value may also become payable, requiring the leaseholder to pay the freeholder 50% of the additional value created by extending the lease.[5]
Leasehold structures are particularly common with flats, where leaseholders own individual flats, while the building and the land beneath it are owned and managed by a freeholder. Leaseholders typically pay service charges to cover the maintenance and management of communal areas and, depending on the terms of the lease, may also pay ground rent, an annual fee paid to the freeholder to occupy the land on which the property stands. The Leasehold Reform (Ground Rent) Act 2022 restricted annual ground rent on new residential leases to a nominal ‘peppercorn’ amount, meaning no financial payment is required.[6] While the structure may be unfamiliar to American buyers, leasehold is a long-established form of property ownership in England, with a comprehensive legal framework governing the rights and responsibilities of leaseholders and freeholders.
A share of freehold is another ownership structure in which the leaseholders collectively own the freehold, often through a management company. This is most common in apartment buildings, where residents own their individual flats while jointly owning and managing the building and its communal areas.
A share of freehold is generally regarded as more desirable than a standard leasehold, as leases are easier to extend and owners have greater control over the management, spending and decision-making relating to the building. However, this also means decisions are made collectively, which can become challenging where owners disagree on maintenance, expenditure, or other matters.
Understanding a property's tenure is therefore an important part of the buying process, as it can affect everything from ongoing costs and responsibilities to the property's long-term value and marketability.
Stamp Duty and Residency
Stamp Duty Land Tax (SDLT) is payable on most property purchases in England and Northern Ireland. The amount due depends on the purchase price and can vary according to factors such as whether the property is an additional home and the buyer's residency status. While purchases of second homes and buy-to-let properties are generally subject to a 5% surcharge, non-UK residents are also liable for an additional 2% surcharge.[7]
Current Residential SDLT Rates (August 2026)
Portion of purchase price | UK resident, only property | Non-UK resident, only property | UK resident, additional property | Non-UK resident, additional property |
Up to £125,000 | 0% | 2% | 5% | 7% |
£125,001–£250,000 | 2% | 4% | 7% | 9% |
£250,001–£925,000 | 5% | 7% | 10% | 12% |
£925,001–£1.5m | 10% | 12% | 15% | 17% |
Above £1.5m | 12% | 14% | 17% | 19% |
Rates are progressive, meaning each rate applies only to the portion of the purchase price falling within that band.
This often confuses overseas buyers, as residency for SDLT purposes is determined by physical presence in the UK rather than citizenship, nationality or visa status. Broadly speaking, an individual is treated as UK resident if they have spent at least 183 days in the UK during the relevant 12-month period.[8]
For buyers relocating to the UK, it may be possible to agree a completion date that falls after the residency requirement has been met, avoiding the non-resident surcharge altogether. Alternatively, buyers who pay the surcharge but subsequently satisfy the residency test within the permitted timeframe may be eligible to claim a refund of the additional 2%.[9]
There is ongoing debate surrounding the future of SDLT, with proposals ranging from changes to the existing system to its replacement with an alternative form of property taxation. However, there are currently no firm plans to abolish the tax, and any significant reform would require considerable policy development.[10] American buyers should therefore continue to factor the current SDLT regime into their purchasing decisions. For those relocating to the UK, understanding how residency and the timing of completion affect SDLT liability can make a significant difference to the overall cost of a purchase.
The Estate Agency System: A Relationship-Driven Market
Perhaps the greatest difference between buying property in the UK and North America lies in the way the residential real estate market is structured. In the United States, realtors typically represent both buyers and sellers, with properties marketed through a Multiple Listing Service (MLS). Once a sale is agreed, commission is generally shared between the buyer's and seller's representatives, creating an interconnected market in which agents cooperate to match buyers with available properties.
By contrast, the prime London market is far more relationship-driven. While estate agents are generally instructed by sellers, buyers typically navigate the market without their own representation. With no centralised MLS, each agency markets its own instructions, and buyers contact individual estate agents directly to arrange viewings. Many of the most desirable homes, particularly at the upper end of the market, are sold discreetly and never appear on the major property portals. As a result, strong relationships, extensive local networks and deep market knowledge can provide access to opportunities that would otherwise remain unavailable.
Dedicated buyer representation is not standard practice in the UK, but buyers may choose to separately instruct and pay a buying agent to support their search. Acting exclusively on the buyer's behalf, a buying agent can identify both on- and off-market opportunities, provide guidance on neighbourhoods and pricing, coordinate viewings, negotiate terms and manage the process from initial search through to exchange. For overseas buyers in particular, this local expertise and single point of contact can be invaluable when navigating an unfamiliar market.
Why so many American buyers choose Hampstead
Beyond the practical considerations of purchasing, location is often what ultimately draws American buyers to London. For many, Hampstead offers a balance that is increasingly difficult to find elsewhere in the capital. It has a rich history that remains evident today, with period architecture, historic pubs, and winding roads that contribute to its distinctive village charm. Tree-lined streets and proximity to sprawling Hampstead Heath create a calm, countryside feel, while excellent transport connections place central London within easy reach.
Hampstead has long attracted prominent figures across business, the arts and entertainment, drawn to its privacy, nature, and distinctive character. Harry Styles is among its long-standing homeowners, while American stars including Taylor Swift and Ariana Grande have spent time living locally. More recently, Eva Mendes and Ryan Gosling settled in Hampstead with their family. Outstanding schools, an established village full of restaurants, cafés and boutiques, and a strong sense of community add to the area’s appeal. For buyers accustomed to a more suburban American lifestyle, Hampstead offers the space and neighbourhood atmosphere they desire without sacrificing the convenience, connectivity and character of being at the heart of London.
[2] Enness Global, Why Are Americans Buying London Mansions Like Never Before?
[4] Timms Solicitors, What is a Simultaneous Exchange & Completion?
[5] Rothmore Property, Leaseholds
[6] GOV.UK, Leasehold Reform (Ground Rent) Act 2022: Guidance for leaseholders, landlords and managing agents
[10] Bishop Fleming, Property tax reform: could SDLT and council tax be replaced?
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