The proportion of foreign landlords owning property in the UK has fallen to a new low, fresh data from letting agent Countrywide reveals.

Just 5 per cent of British homes now have overseas owners, compared with 12 per cent in 2010, with London leading the way, where the proportion of overseas landlords has fallen from 26 per cent to 11 per cent.

Tax changes appear to have deterred some investors, while others have opted for property in cheaper areas instead.

Johnny Morris, research director at Countrywide, said: "A steady increase in foreign investors' tax bills combined with more recent falling expectations of price growth in London has led to a decline in foreign investment in BTL.

"As well as having to contend with increased stamp duty and ATED, overseas investors also saw the removal of capital gains tax exemptions in 2015."

The biggest fall in foreign ownership in London has been amongst Europeans. In 2010 they made up 39 per cent of foreign investors, but they now account for 28 per cent.

Asians, including those from Hong Kong, have taken over as the biggest London buyers.

While the decline in sterling has made UK properties relatively cheaper for foreign investors since June 2016, landlords have been hit by earlier tax rises.

Investors who already own a property have had to pay a 3 per cent surcharge on Stamp Duty (Land and Buildings Transaction Tax in Scotland) since April 2016.

Companies buying property in the UK have also been liable for the Annual Tax on Enveloped Dwellings (ATED) since April 2012,

This amounts to £3,500 a year for properties worth between £500,000 and £1m, or £7,050 for those worth over £2m.