The Autumn Budget is expected to provide much-needed clarity to the UK property sector after months of uncertainty that have stalled transactions, according to market observers.
The package includes measures affecting property taxes, energy costs, planning reform, and pension contributions, all of which are likely to shape the behaviour of buyers, sellers, landlords and tenants in the coming months.
High-end sales are set to face new challenges, particularly in London and the South East, following the introduction of the so-called “mansion tax” on properties valued above £2 million.
At the same time, landlords will need to account for a 2% rise in property income tax, which could affect rental returns and influence decisions around property retention or sales.
EASING AFFORDABILITY PRESSURES
Beyond taxes, changes to energy pricing are expected to ease affordability pressures for tenants and homeowners, while government funding aimed at improving the planning system could accelerate delivery of the 1.5 million homes the UK has committed to building.
Meanwhile, high earners may reassess their investment strategies in light of National Insurance charges on ‘salary sacrifice’ pension contributions from April 2029, and agencies may increasingly turn to technology to offset rising costs associated with a higher national minimum wage.
Technology adoption and insight-driven management are emerging as key differentiators for property agencies navigating this new landscape. Firms with tools to map client activity and predict market readiness will be better positioned to maintain transactions and capture opportunities.
INDUSTRY REACTION
Richard Donnell, Executive Director at Zoopla, says: “Today’s Budget delivers welcome relief for the 210,000 homeowners selling properties over £500,000, removing the threat of a new annual property tax that had stalled market activity.
“We expect this to renew buyer interest as we head into 2026, particularly across London and southern England where a large share of homes for sale sit above this threshold.
“This is the moment for agents and housebuilders to get ahead of their competition by tailoring their marketing messaging to unlock latent demand before the Boxing Day bounce and boost in traffic Zoopla traditionally sees in the new year.”
VALUATION CLIFF-EDGE
Dr Neil Cobbold, Commercial Director at Reapit, says: “Today’s Budget will affect sales and lettings differently across the UK, but it will finally bring clarity after months of speculation that have hampered transactions.
“The ‘mansion tax’ on properties worth £2m or more will create a cliff-edge on valuations and potentially pause some high-end sales, particularly in London suburbs and the South East.
“The 2% increase in property income tax will dent landlord income and risk rental property attrition at a time when we need more supply. However, it also creates an opportunity for expert agents to advise on alternative strategies, such as higher-yield tenancy types including student rentals and HMOs, refinancing options to reduce mortgage payments, or even transitioning properties to sales.
“Lower energy prices will improve affordability for tenants and potential homeowners – a welcome boost in a challenging market.”
“Beyond property taxes, lower energy prices will improve affordability for tenants and potential homeowners – a welcome boost in a challenging market. The funding allocated in this Budget to improving the planning system is another welcome step towards accelerating the delivery of the 1.5 million homes the government has committed to.
“Charging National Insurance on ‘salary sacrifice’ pension contributions above £2,000 from April 2029 could prompt some high earners to look for alternative investments. The best agents will be able to show that property remains an attractive option.
“Agencies looking to hire for entry-level jobs may be forced to reconsider.”
“Meanwhile, with large increases in the national minimum wage, agencies looking to hire for entry-level jobs may be forced to reconsider and instead focus on AI and technology designed to make existing teams more efficient.
“As agents absorb these tax and spending changes and provide professional advice to vendors, buyers, landlords and tenants, their business focus will be on gaining every competitive advantage.
“Those businesses with the technology to deliver clear insight into their customers’ business flows across sales and lettings will be best placed to identify which vendors, buyers, landlords and tenants are ready to move or sell.
“Agents who combine proactive advice with digital efficiency won’t just rebuild pipelines – they will accelerate growth and strengthen trust with their clients as the market adapts to new rules.”
WELCOME CLARITY
Iain McKenzie, CEO of The Guild of Property Professionals, says: “As with so many Budgets before it, the run-up to today’s announcement has seen a clear ‘wait-and-see’ sentiment across the housing market.
“If nothing else, the clarity we now have, rather than ongoing speculation, is welcome.
“Fiscal measures announced in a Budget have the power to either inject confidence and stimulate activity or, conversely, apply the brakes.
“Our hope is that today’s measures achieve the former, particularly given the significant knock-on effect the property sector has on the wider economy.
“The introduction of a Mansion Tax on properties valued at £2 million and above from 2028 will be met with concern by many. It’s a part of the market that plays an important role in overall economic activity, and any intervention must be approached with caution.
Above all, what the market needs now is stability and a clear pathway that encourages buyers and sellers to move forward with confidence. We’ll be watching closely to see how today’s announcements translate into real-world activity over the months ahead.”
SURPRISE TAX INCREASES
Aneisha Beveridge, Head of Research at Hamptons, says: “After weeks of speculation that froze the housing market, the Budget finally delivered clarity – and a few surprises.
“The government opted for a council tax surcharge on homes worth £2 million or more: headline-grabbing, but relatively narrow in scope.
“It will create cliff edges, with homes just below the threshold gaining appeal, and the surcharge – due from April 2028 after a nationwide valuation exercise – could weigh on values of prime properties near the threshold over the next few years as reassessments and uncertainty play out.
“Still, given the price point at which it kicks in and the sums involved, the overall impact on the prime market is likely to be limited.
“The bigger surprise was the increase in property income tax rates – adding further pressure on landlords who own property in their personal name. Those operating through limited companies will remain unaffected, but for individual landlords who make up the bulk of the market and who are already squeezed by higher borrowing costs and previous tax changes, this could accelerate the trend of investors exiting the market. Over time, that risks reducing rental supply and pushing rents higher.
“Taken together, these measures should draw a line under months of uncertainty and give the mainstream market the clarity it needs to move forward, even if the top end remains a little tentative. Despite headline tax rates on expensive homes and landlords going up, the OBR don’t believe the new taxes will raise any money at all, with behavioural changes eating away at tax revenues.”
DISASTROUS FOR LANDLORDS
Jason Tebb, President of OnTheMarket, says: “The additional tax on rental income is disastrous for landlords. After a decade of being squeezed by mortgage interest relief cuts, wear-and-tear allowance removal, SDLT surcharges, fiscal drag, and endless red tape, this move further erodes net yields, especially for highly leveraged landlords.
“This reform will simply see more and more landlords removing themselves from the PRS sector for a further squeeze on rental supply.”
RESHAPING THE PROPERTY SECTOR
Sam Mitchell, Chief Commercial Officer, CCO, Lomond, says: “Today’s Budget introduces significant changes that will reshape the property sector, but it also delivers the clarity the industry really needs after months of uncertainty and speculation.
“Landlords tell us they want certainty, practical guidance, and the confidence to make the right decisions.
“While recent uncertainty has slowed the market’s natural momentum, now is the time to act decisively to protect investments.
“Working with professional lettings and sales agents will help ensure landlords, tenants, homeowners and buyers, stay up to date with any changes that affect them, and protect property interests.
“With the right support and preparation from informed agents, landlords can continue to manage their assets confidently and maintain strong, stable tenancies, even in a shifting policy environment.”
LACK OF SUPPORT
Richard Sexton, Commercial Director of proptech surveyor portal Houzecheck, says: “Rachel Reeves could have done us all a favour by reducing stamp duty rates for first-time buyers and all residential purchases below £500,000.
“Lowering a transaction tax like this would have decreased upfront costs for buyers and stimulate demand, especially among younger first-time buyers.
“Evidence from past cuts shows sales volumes increasing within months. She could have introduced a temporary stamp duty holiday for properties under £750,000 for the next 12 months.
“Historically these boost market activity – just look at the impact this had in 2020 when buyers rushed to complete deals before the due date and sellers list more properties. A cut in stamp duty would have signalled government support for brokers, conveyancers and agents. The new Mansion Tax signals precisely the opposite.
“As a proptech, we’d also like to have seen more focus on AI skills; while we’re one of the largest independently-owned valuation chains in England and Wales, we still need more people with machine learning skills to help speed up delivery of our reports and improve their quality even further.”
