Much of that uncertainty has been the result of a whole series of leaked stories about potential new property taxes. The latest is a rumoured 1% annual mansion tax on homes over \u00a32 million. It would mean a \u00a32.5 million home would have to pay \u00a35,000 tax annually and even higher rates for super-prime and second homes.<\/p>\n
Other reported taxes include replacing stamp duty with property taxes on sales over \u00a3500,000, CGT on primary residences, and National Insurance on rental income.<\/p>\n
So far, there is no real substance to any of the rumours, but Dominic Agace (pictured), CEO at Winkworth, says: “Speculation of this kind has already affected the market, and it’s hard not to see how such a tax won’t cause wealth destruction.”<\/p>\n
Rightmove\u2019s data clearly shows its impact – \u00a0new buyer enquiries are down 5% on last year, sellers coming to market are also down 5% and sales agreed are down 2%. Average asking prices rose just 0.3% in October, but that\u2019s well below the ten-year average increase of 1.1%.<\/p>\n
Matt Smith, Rightmove’s mortgage expert, says lenders have also “hit the pause button” ahead of the budget, with few shifts in rates as they wait to see how policy announcements may affect them.<\/p>\n
The conditions mirror those of October 2024 almost completely. Back then, there was also speculation about National Insurance on rental income, CGT on family homes and a stamp duty replacement dominated headlines, and it created the same freeze in activity with buyers and sellers all sitting tight.<\/p>\n
But when Reeves finally delivered her Budget on 30th October, it was far less draconian than originally feared. The second home stamp duty surcharge rose from 3% to 5% and first-time buyer thresholds fell in April, but residential CGT rates stayed at 18% and 24%. The mansion tax didn’t happen, and neither did National Insurance on rents.<\/p>\n
The market reacted immediately – Chestertons reported a 71% spike in sales, Yopa saw 84,000 homes listed (a rise of 11.4%) \u00a0in just two weeks, and Nationwide reported house prices growing at 3.7%, the fastest pace in nearly two years.<\/p>\n
If this Budget follows a similar pattern, the ensuing relief could unleash considerable pent-up demand. All those buyers who have been waiting since August, all those sellers who’ve delayed and all those transactions on hold.<\/p>\n
The market fundamentals would certainly support a bounce, too. Wages are rising faster than house prices, with regular pay growth at 4.9% against house price growth of 2-3%. Unemployment remains low at 4.3%. The Bank has cut rates to 4% and five-year fixes are below 5% for the first time since May 2023.<\/p>\n
Guy Gittins (pictured), CEO at Foxtons, says: “While the market has clearly slowed in recent weeks, much of this reflects a natural pause as buyers and sellers understandably take stock ahead of the November Budget. Once there is greater clarity around taxation and economic policy, we expect confidence to return quickly \u2013 particularly in London, where underlying demand remains strong and well-funded buyers are still active.”<\/p>\n
Whether the 26th November proves to be yet another case of over-speculation remains to be seen, but if it does, last year showed how quickly the market can recover.<\/p>\n
And, for the braver buyers who are willing to make a move beforehand, the current market conditions offer some serious advantages, with more choice, less competition, and sellers who are willing to negotiate.<\/p>\n","protected":false},"excerpt":{"rendered":"
Budget uncertainty has frozen the property market with buyer enquiries, new listings and sales all down on last year, but lessons learned from Reeves’ previous budget suggest it could rapidly turn around in its aftermath. Much of that uncertainty has been the result of a whole series of leaked stories about potential new property taxes.… Read more »<\/a><\/p>\n","protected":false},"author":4233,"featured_media":6106683,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"footnotes":""},"categories":[4,765,59,6],"tags":[768,207],"class_list":["post-6106682","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-investment","category-property-investment","category-trending-news","category-uk-housing-market","tag-autumn-budget","tag-tax"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/posts\/6106682","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/users\/4233"}],"replies":[{"embeddable":true,"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/comments?post=6106682"}],"version-history":[{"count":6,"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/posts\/6106682\/revisions"}],"predecessor-version":[{"id":6106689,"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/posts\/6106682\/revisions\/6106689"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/media\/6106683"}],"wp:attachment":[{"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/media?parent=6106682"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/categories?post=6106682"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/tags?post=6106682"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}