Rightmove survey shows the impact Budget concerns are having on buyer and seller behaviour, with nearly one in five movers pausing their plans as speculation over property taxes intensifies. However, with the Budget only days away, market sentiment could change very quickly.
Awareness and concern running high
In the meantime, though, those concerns are widespread. Of the 10,000 people Rightmove questioned who were either actively in the process of moving home or considering moving, over 6,000 (61%) said they were aware of rumoured property tax changes, and nearly 8,000 (79%) said they were concerned about them.
And 17% said they planned to wait for the Chancellor’s announcement before progressing. Concern was strongest among those aged over 55 (81%), who tend to own homes further up the ladder and are therefore more exposed to any potential new taxes.
Caution concentrated in southern markets
For much the same reasons, concerns are also at their highest in the South East and South West (81%).
As a result, agents in those areas report slower movement and tighter stock as households adopt a temporary “wait and see” approach.
Mary-Lou Press, President of the estate agency body, NAEA Propertymark, says:
“For many households, moving home is one of the biggest financial decisions they will ever make, and unexpected costs, real or anticipated, naturally weigh heavily.
“What we’re seeing is people taking a ‘wait and see’ approach, particularly in regard to older homeowners and those in higher-value regions, where the impact of any change could be greater.
“While most movers are continuing as normal, a slowdown in activity from even a small proportion of buyers and sellers can reduce choice in the market and lengthen transaction times. This can create a ripple effect, especially for chains relying on downsizers or those selling homes at the upper end.”
Majority of movers remain active
It’s by no means all bad news, though, as some 83% are still continuing with their home-moving plans as normal. Rightmove’s property expert Colleen Babcock said:
“Our latest House Price Index showed how market activity is being affected by the various property tax rumours being discussed ahead of the Budget. Now, we’ve heard directly from home-movers about how it’s denting their confidence, with some preferring to wait until after the Budget to see how any policy announcements affect their plans.
“While most movers are carrying on as normal, it demonstrates how unhelpful the uncertainty over potentially costly changes can be. I think most are now fed up with the rumours and would like to see the final contents of the Budget and assess how they’re impacted.”
And when asked what would make the housing market work better, many respondents reacted positively to the recent rumours about more flexible Stamp Duty arrangements — particularly the option to pay the tax in stages rather than upfront. Others mentioned region-specific thresholds and changes that would make it easier for older homeowners to downsize.
Short-lived slowdown as Budget nears
There is no doubt, though, that the pause in activity is only likely to be a very temporary phenomenon. By this time next week, homeowners will all know exactly what is in the Budget and, after a short hiatus, the renewed certainty should unleash a wave of pent-up activity. However, at the very top end of the market, there are likely to be more changes to absorb, and so its recovery could take a little longer.
