What the Latest Budget Measures Mean for the Housing Market

Autumn Budget 2025: What the Latest Measures Mean for the Housing Market in London

The Chancellor, Rachel Reeves, has now presented the Autumn Budget, introducing a series of updates that will gently reshape the property landscape in the years ahead. While many anticipated changes to stamp duty, none have been announced. Instead, the focus turns to a new levy for higher value homes and an additional 2% income tax on rental income, developments that homeowners and landlords will want to be mindful of as they plan ahead.

A New Mansion Tax for Homes Above £2 Million

From April 2028, properties valued over £2 million will be subject to an annual mansion tax, paid by the homeowner. Homes between £2 million and £5 million will see a yearly charge of £2,500, rising to £7,500 for those above £5 million. This new charge will sit alongside existing council tax arrangements.

Although only a very small proportion of homes fall within this price range, less than 0.5% of all agreed sales this year—the upper end of the market has already shown signs of settling. Sales above £2 million are down 13% year-on-year, suggesting that buyers and sellers have been adjusting to the prospect of this change for some time.

When Will the Mansion Tax Begin?
The new charges will come into effect from April 2028.

What Does This Mean for Homeowners?
Annual fees will depend on the property’s market value.