Estate agents and property finance specialists are warning the chancellor against further tax increases that could discourage investment and prolong uncertainty across the housing market. Ahead of today’s Autumn Budget, concerns remain over the treatment of high-value homes, property investment, bank taxation and inherited land.
The planned High Value Council Tax Surcharge, scheduled to take effect in April 2028, has attracted particular attention. The measure is intended to apply to residential properties in England worth £2m or more. Although recent reports suggest the government has ruled out lowering the threshold to £1.5m, uncertainty remains over whether further measures could affect expensive homes or overseas owners.
Prime London market faces further pressure
Marc von Grundherr, director of Benham and Reeves, warned that additional property taxes could weaken activity in the capital. “London’s prime property market already operates under a substantial tax burden, and further measures aimed at wealthier homeowners or international buyers risk weakening the capital’s appeal as a destination for investment,” he said.
“The Government should be encouraging confidence and activity across the market, not creating further reasons for buyers and sellers to hold off.” The warning comes as higher borrowing costs and economic uncertainty continue to influence buyer decisions.
Bank taxes raise lending concerns
Jonathan Samuels, CEO of Octane Capital, also urged caution over potential increases to taxes affecting banks. He warned that higher costs for financial institutions could have consequences for lending and investment.
“The property sector relies heavily on access to finance, whether that’s developers bringing new homes to market, investors upgrading existing housing stock or buyers navigating increasingly complex transactions,” he said. “Any measures that discourage lending or make capital more expensive could ultimately undermine the very growth the Government is trying to achieve.”
However, the impact of any additional bank taxation would depend on the measures announced and how lenders respond.
Rural landowners seek clarity
Inheritance tax remains another concern, particularly for owners of farms and rural estates. Adam Morris, founder of LandSale, warned that further changes to Agricultural Property Relief and Business Property Relief could complicate succession planning.
“Further changes to inheritance tax and agricultural property relief could have a considerable impact on how landowners approach succession planning,” he said. Morris added that some families could face difficult decisions where inherited assets carry substantial tax liabilities but generate limited available cash.
The chancellor has yet to confirm whether further changes will be made in these areas. For agents, developers and investors, the immediate concern is whether the Budget will increase transaction costs or provide greater certainty over future taxation.
