The UK property market is bracing for potential disruption as Chancellor Rachel Reeves prepares to deliver the Autumn Budget on 26th November, with speculation mounting over tax changes and reforms that could impact agents, landlords, investors and brokers.
Analysts are urging market participants to stay flexible and prepare for a possible surge in activity following the announcement.
Paresh Raja (main picture), Chief Executive of Market Financial Solutions, reckons that the Budget is likely to be “loaded,” with several headline-grabbing tax measures expected for the second year in a row.
Among the key policies to watch, Raja highlighted: potential income tax increases, which may not be offset for landlords by proposed cuts to national insurance; reforms to stamp duty; an extension of capital gains tax to primary and secondary properties; and possible changes to planning laws and the house-buying process.
NEW RULES
But Raja cautions against over-speculation ahead of the Chancellor’s speech, pointing out that pre-Budget predictions often paint a harsher picture than the eventual reality.
And he adds that market activity could rebound strongly once the details are known, with lenders, buyers and sellers all adjusting to new rules.
He says: “This is clearly going to be a loaded Budget. Rachel Reeves has issued some warning shots and, for the second year in a row, it looks like various tax hikes could steal the headlines on 26th November.
“For the property market, there has been a lot of conjecture as to what will be in the Chancellor’s favour red briefcase.
“For landlords, property investors, and the brokers working with them, there are some key policies to watch out for: an increase to income tax (though touted to be offset for many by a cut in national insurance, this will not be true for landlords); reforms to stamp duty, which have been speculated over wildly; extending capital gains tax to include primary and secondary homes; and potential changes to planning laws and the house-buying process.”
“At this stage, adding to the speculation is pointless.”
“At this stage, adding to the speculation is pointless. Across the property market, from lenders and brokers to buyers and sellers, it is a question of adapting quickly to whatever the Chancellor announces.
“What’s more, though inertia has started to set in as the Budget approach, I would expect a flurry of activity afterwards. Indeed, amidst all the predictions about the tax blows that could land, the reality is typically less painful than the pre-speech doom-mongering.”
MARKET WILL REMAIN BOUYANT
And he adds: “Ultimately, we have to be ready to take any changes in our stride and, if the Bank of England does come through with multiple cuts to the base rate in the coming year, then there is every reason to believe the market will remain buoyant.
“After all, even with a great deal of political and economic turbulence this year, house prices have continued to rise and buyer demand for UK property remains strong.”
