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Wealthy people leaving London

January 2018

By New World Wealth

January 22, 2017 | 18:00 | Dubai

Over the past 30 years, the United Kingdom has been one of the biggest recipients of migrating millionaires (HNWIs). However, this trend changed in 2017 when the country experienced its first major HNWI net outflow. Although around 1,000 HNWIs came into the UK during the year, this was more than cancelled out by a bigger outflow of around 5,000 HNWIs, resulting in a net outflow of around 4,000 HNWIs for the year.

 

Possible reasons for the UK’s poor performance in 2017:

  • New taxes on non-doms and foreigners with homes in the UK made it more expensive and more complicated for migrating HNWIs to buy homes in the UK. 
  • The UK’s traditionally high inheritance taxes made the likes of Australia and the US more appealing to migrating HNWIs (post Brexit). Notably, Australia has no inheritance taxes, whilst in the US the inheritance tax threshold is much higher than in the UK. Note: the US is now talking about scrapping inheritance taxes all together which would make the UK even more unappealing to HNWIs.
  • Several European HNWIs living in the UK moved back to their home countries in 2017, possibly due to Brexit. Furthermore, relatively few new HNWIs came into the country during the year when compared to previous years.
  • Rising crime levels and rising religious tensions, especially in London (see below).

 

Concerns for London

London has experienced a steady rise in incidents of rape, terrorism, acid attacks and woman trafficking over the past few years. Religious tensions and anti-semitism are also at an all-time high in the city. All of these factors have pushed local HNWIs out of the city, while also discouraging foreign HNWIs from entering.

 

London was obviously a hotspot for migrating HNWIs for many years. However, this trend appears to have changed over the past couple years as migrating HNWIs now prefer moving to safer “international cities” such as Sydney, Melbourne, New York and San Francisco. “International cities” refer to first world cities which attract business people from all over the world. They tend to have English as their main language.

 

In last year’s report, New World Wealth highlighted the fact that many wealthy Londoners were moving out of the city to small affluent towns such as Bray, Taplow and Marlow. This is a notable trend that is gaining momentum. A large number of wealthy Londoners are also leaving the UK altogether – many of these individuals are going to the US and Australia.

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