London’s property market is defined by three things a foreign buyer needs to understand early: stamp duty, which rises steeply with price and adds surcharges for non-residents and second homes; the difference between freehold and leasehold; and the gap between prime central London and the rest of the city. This page explains the headline figure and each of those costs.
What the headline figure means
Poyzo’s working figure for London is about €8,600 per m², a rounded average converted from pounds. Prime central boroughs are far above it and outer boroughs well below. UK listings often quote square feet rather than square metres (1 m² is about 10.76 sq ft), and floor plans may include areas that a continental European listing would exclude, so compare carefully.
Stamp duty land tax (England)
| Portion of the price | Standard rate |
|---|---|
| Up to £125,000 | 0% |
| £125,001 to £250,000 | 2% |
| £250,001 to £925,000 | 5% |
| £925,001 to £1.5 million | 10% |
| Above £1.5 million | 12% |
- First-time buyers pay 0% up to £300,000 and 5% from £300,001 to £500,000, if the price is no more than £500,000.
- Additional homes (including buy-to-let and second homes) carry a 5% surcharge on every band.
- Non-UK residents pay a further 2% surcharge on every band.
Each rate applies only to the portion of the price in that band. These bands have applied since April 2025.
Other costs and rules
- Legal fees and searches for conveyancing, plus a survey, typically add a few thousand pounds.
- Leasehold vs freehold. Most London flats are leasehold: you own the flat for a fixed term and pay service charges, and sometimes ground rent, to the freeholder. Short leases (under about 80 years) are expensive to extend and harder to mortgage.
- No restrictions on foreign buyers, but overseas entities that own UK property must be registered, and UK lenders apply stricter criteria to non-resident borrowers.
- Council tax is an annual local tax based on the property’s valuation band, paid by the occupier.
Worked example: what €400,000 buys
At €8,600 per m², €400,000 corresponds to roughly 47 m² at the city average, typically a one-bedroom flat. Converted to around £340,000, a buyer replacing their main home would pay about £7,000 in stamp duty; a non-resident buyer would pay about £13,800; a non-resident buying an additional home would pay about £30,800. The price is the same in each case; the tax changes the total by more than 6% of the price.
Sources: HM Revenue & Customs (Stamp Duty Land Tax rates and surcharges), HM Land Registry UK House Price Index, Register of Overseas Entities (Companies House). Figures checked October 2026.
Related on Poyzo
- Car prices and running costs in London
- Service charges and building fees explained
- Mortgage access for non-residents
- The costs of buying property abroad that are not the price
- Gross yield vs net yield: what eats the difference
- Compare your budget across all eight cities
Information only. This page explains how buying costs and rules are structured. It is not financial, tax, legal or immigration advice and it is not a recommendation to buy any property. Rates and rules change; confirm anything that affects a decision with the relevant authority or a qualified local professional.
Last updated: October 14, 2026