The UK housing market is showing signs of slowing down amid speculation that Chancellor Rachel Reeves could announce tax increases on property in next month’s budget. Figures from Rightmove show that both the number of new buyers contacting estate agents and the number of new sellers coming to market slumped by 5% in September compared with the same month last year.
Rightmove said the market remained “resilient”, but warned that the typical post-summer bounce in activity was failing to materialise. “Speculation that the budget may increase the cost of buying or owning a property at the higher end of the market, has given some movers, particularly in the south of England, a reason to wait and see what’s announced in the budget,” said Colleen Babcock, a property expert at Rightmove.
The Treasury has explored a new tax on the sale of homes over £500,000 and the removal of the capital gains tax exemption on primary residences above £1.5m. A new council tax band for higher-value properties in England could also be considered. The average price of property coming to market rose by 0.3% in October to £371,422, below the 10-year average of 1.1%.
Tom Bill, head of UK residential research at Knight Frank, said: “Transaction numbers over the last six months have been supported by stable mortgage rates and softer prices as sellers come to terms with the fact that high levels of supply mean it is a buyer’s market. However, demand is wavering for the second successive year as the autumn market gets under way, as speculation over the budget becomes a prolonged and frustrating game of ‘guess the tax rise’.”
A Treasury spokesperson said: “We are taking action to get Britain building so more new homes are available, including through strengthening call-in powers, tearing up burdensome regulations, and streamlining planning permissions with AI. The budget will strike the right balance between making sure that we have enough money to fund our public services while ensuring we can bring growth to boost living standards.”
