The Autumn Budget 2025 has landed – and yes, there are some new tax and property-related measures that deserve attention. That said, there’s also reason for optimism. For homeowners, buyers and even sellers, the picture doesn’t have to be bleak. Here’s a balanced, hopeful breakdown of what’s happening – and why the property market can still hold up.
➤ What’s new: key Budget measures affecting property
The government will introduce a new surcharge (“mansion tax / high-value home charge”) on properties worth over £2 million. For homes in the top bracket (over £5 million), this could mean an additional annual charge.
From April 2027, income tax on rental (property) income will rise by two percentage points across all bands.
The thresholds for income tax and National Insurance will remain frozen for several more years – a “stealth-tax” that increases the overall tax burden over time.
Because of these changes, some landlords are likely to see a squeeze on returns, which could reduce the attractiveness of buy-to-let investments. That may reduce rental property supply over time which – if demand remains robust – could push rents up.
🛠 Why this doesn’t have to be bad – and could even unlock opportunity
Despite these potentially unwelcome headlines, several factors give room for cautious optimism – especially for ordinary homeowners, sellers and buyers outside the ultra-luxury segment:
The new high-value home surcharge applies to fewer than the top 1% of properties.
For the vast majority of homes – the everyday £200K–£1M+ bracket – the Budget doesn’t impose new property taxes directly. That means the core of the market remains broadly unaffected.
With potential pressure on buy-to-let yields, some landlords may exit the market or raise rents, which could open supply for owner-occupiers (or encourage a shift toward owner-occupation over renting).
The wider economic context laid out by the Budget aims to stabilise public finances, reduce debt interest and ease pressure on public services and borrowing. That long-term stability supports confidence in the housing market as a relatively safe asset – particularly for people planning to buy or hold property over several years.
For those looking to sell or downsize, a potential slowdown at the top end could shift buyer demand toward more “mainstream” homes – possibly supporting demand/prices for mid-market properties.
✅ What this means for different groups
| You are… | What to know now | Why you might hold or move |
| A homeowner in the mid-price range | Your property is likely unaffected by the new surcharge or extra taxes | Good time to reassess plans – market remains stable and demand may shift from top-end homes toward mid-market homes |
| A first-time buyer or up-sizer | Fewer competing buyers at ultra-high end may reduce overall demand pressures | Could be a favourable window to act before any long-term rent/price shifts |
| A landlord / buy-to-let investor | Rental income tax rises may squeeze yields; costs could creep up | Time to reconsider hold vs. sell strategy – or to adjust rents/terms carefully |
| A seller of a high-end property (2 M+ £) | New surcharge may narrow pool of buyers or affect offer levels | Might prompt a strategic sale beforehand or adjusting price expectations |
🧭 Looking ahead: what to watch
Implementation timeline – the new surcharge begins in 2028, giving time for owners and investors to plan ahead.
Potential ripple effects on rental supply, demand and pricing – landlords may reassess portfolios which could influence rental and resale markets.
Broader economic picture – if the Budget helps stabilise the economy and government finances, property could remain a secure, long-term asset compared with other investments.
➤ Final Thought
Yes – the Autumn Budget introduces tougher rules for very high-value homes and property income. But for most of the property market – especially mid-market homeowners and prospective buyers – the effects are modest. In fact, shifting sentiment among landlords and luxury-home owners could create unexpected opportunities for buyers and ordinary sellers. With a strategic approach, 2026–28 could be a savvy time to buy, hold or sell.
Contact us today if you have any questions and let our team guide you! Give us a call on 01843 269188 or email us at mail@alexander-russell.co.uk