Property experts are hopeful of a pick-up in home sales as the dust settles on the Autumn Budget.
Intense speculation about changes Chancellor Rachel Reeves may make has dampened the housing market in the weeks leading up to the November 26 Budget.
In particular, rumors that Reeves might reform the council tax system, or even change stamp duty (such as shifting the tax from buyer to seller), have prevented many property deals from going ahead.
A direct result of the tax hike will be a freeze in the high-end market as buyers and sellers wait for valuations
The Bank of England’s money and credit data for October strongly suggests that buyers and sellers will hold off on housing decisions until after the Budget.
Net personal mortgage lending fell to £4.3 billion, down from £5.2 billion in September. Meanwhile, net approvals for home purchases totaled 65,000 and approvals for remortgages fell to 33,100, the lowest level since February 2025.
Quilter mortgage expert Karen Noye said: “Much of November has been dominated by budget rumors and many buyers are just waiting to see what the chancellor will do.”
The Budget ended up bringing a lot of bad news to the housing market, especially for landlords and owners of expensive homes.
Starting in April 2027, property income taxes will increase by 2% for landlords in all tax brackets.
At the same time, the Chancellor also introduced a new “high value council tax surcharge”, known as the “Mansion Tax”, on owners of properties worth more than £2 million from April 2028.
Only now that the details have been released can those who have been putting off making a decision start progressing with their home purchase, remortgage or conversion deal
Both measures were criticized by the mortgage and real estate industries.
Speaking on Budget day, Ben Biddle, chief executive of the National Association of Residential Landlords, said increasing taxes on property investors would “push rents up”.
Regarding the changes to the mansion tax, Homeowners Alliance chief executive Paula Higgins said: “The immediate result will be a freeze at the top end of the market as buyers and sellers await valuation results.”
However, the chancellor’s announcement that the annual Isa cash limit will be cut to £12,000 from 6 April 2027 (except for over-65s) has prompted more budget scorn. Nottingham Building Society said cuts to Isa cash benefits could mean mutual lenders have fewer cash deposits and therefore less money available for mortgages.
But now the view among property experts is that while it has added extra costs to parts of the property market and may limit mutual lending, it is not as bad as imagined. Many believe this, combined with the certainty of finally knowing the Prime Minister’s intentions, should mean confidence will return to markets.
Jeremy Leaf, a north London estate agent and former residential chairman of the Royal Institution of Chartered Surveyors, said: “It turns out the housing measures in the Budget are not as harmful as some kites had previously suggested and expectations of a modest rebound are inspiring more activity.”
Property tax changes are unlikely to have a major impact on the housing market
Rachel Springall, finance expert at Moneyfacts, said: “Borrowers were likely to be hesitant to get a mortgage in October, with net mortgage approvals for both house purchases and remortgages falling.
“However, the slowdown in activity comes at a time when many borrowers are uncertain about the budget outcome. Now that the budget has been released, activity is likely to pick up as we approach the end of the year.”
Building societies across the country have taken a more optimistic view of the Budget’s impact on property sales. Its November house price index found annual price growth slowed slightly to 1.8% in November from 2.4% the previous month.
Despite this, Nationwide chief economist Robert Gardner said: “Changes to property tax are unlikely to have a significant impact on the housing market. The high value council tax surcharge will not be introduced until April 2028 and will apply to less than 1% of properties in England and around 3% of properties in London.”
However, some experts believe the shockwaves from the Budget will ripple through the market for some time.
Speaking in early December, Quilter financial planner Ian Futcher said: “As the budget is released in the last few days of November, it is likely that [December’s] The data will also reflect this caution ahead of the budget.
With housing measures not as harmful as some say, expectations for a modest rebound are spurring more activity
“Only now that the details have been released can those who have been putting off making a decision start progressing with their home purchase, remortgage or conversion deal.”
While the Budget hasn’t received the warmest reception from markets, it’s not the horror show many feared. Experts agree that the only way housing transactions are going is up. The question is: how fast?
This article appears in the December 2025/January 2026 edition Mortgage strategy.
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