With the Autumn Budget now unveiled, many homeowners, landlords and prospective buyers will be wondering how the latest changes could affect the property market. From proposed new charges on high-value homes to increased tax for landlords, these announcements could influence decisions across all sectors of the market. Here’s what you need to know and what it could mean for your property journey.

New ‘Mansion Tax’ for Properties Over £2 Million

Properties valued at more than £2 million will be liable for an annual surcharge, payable in addition to council tax. The proposed charges are:

• £2,500 per year for homes worth over £2 million
• £7,500 per year for homes worth over £5 million

This tax will be charged to the property owner rather than the occupier.

Current market data indicates that fewer than 0.5% of agreed home sales this year have exceeded £2 million, with only around 1% of properties currently listed above this level. However, sales in this bracket are already 13% lower year-on-year, suggesting that uncertainty and speculation have begun to suppress activity.

When Will the Mansion Tax Begin?

The new surcharge is due to come into effect in April 2028. The government has confirmed that a targeted valuation exercise will take place every five years to determine which band a property falls into.

This will primarily impact homeowners in London and the South East, where higher-value properties are concentrated.

Landlord Rental Income Tax to Increase

From April 2027, landlords will see income tax on rental profits rise by 2%. Instead of introducing National Insurance on rental income – as previously rumoured – the government will increase property income tax rates to:

• 22% for basic rate
• 42% for higher rate
• 47% for additional rate

What Could This Mean for Landlords?

Higher taxation will reduce net yields, which may prompt some landlords to raise rents to compensate. Others, particularly smaller landlords or those with tighter margins, may choose to exit the market altogether.

Stamp Duty: No Changes

Despite extensive rumours, the Autumn Budget did not introduce any changes to stamp duty. This will come as a relief to many buyers who had been delaying decisions in anticipation of potential reforms.

When Will the Market Feel the Impact?

While some of the measures will not take effect until 2027 and 2028, market behaviour often responds well in advance. The period of uncertainty has already influenced activity, particularly in higher-value segments.

Now that the Budget has been confirmed, buyers and sellers alike have clearer guidance, allowing them to plan moves with greater confidence. Importantly, those who may be affected by the changes still have time to review their options and seek professional advice.

Key takeaways:

• Homes valued above £2 million will be subject to a new “mansion tax” from April 2028
• No changes have been made to stamp duty, despite widespread speculation
• Landlords will face a 2% increase in income tax on rental income

Chancellor Rachel Reeves’ Autumn Budget introduces several measures that directly affect the property sector, with implications for homeowners, investors and prospective buyers alike.

If you have any questions, please don’t hesitate to contact Blue Turtle Property, where on hand for any guidance or advice.