UK Budget 2025: What it means for your property plans

At the end of November, Chancellor of the Exchequer Rachel Reeves unveiled the UK Budget, sparking widespread debate about its implications for property owners and investors. In the weeks leading up to the announcement, headlines were dominated by talk of a so-called ‘war on the wealthy’, leaving many wondering what this would mean for their homes and the wider property market.

In reality, the outcome was less severe than many had anticipated. As Savills noted, it was “probably the least worst outcome for owners of prime property”. However, several changes will impact decisions for buyers, sellers, and landlords in the coming years.

Here’s what you need to know:

1. Stamp duty

Despite speculation, stamp duty remains untouched in this year’s Budget. For many, this offers a welcome sense of stability – at least for another year.

2. High Value Council Tax Surcharge 

One of the most talked-about measures is the introduction of an annual surcharge on properties dubbed the ‘Mansion Tax’, The surcharge impacts properties worth more than £2 million in England, starting in 2028. This will apply in addition to council tax and is structured across four bands:

This new charge will impact homes in London and the South East area of England the most, where the largest concentration of properties in these price brackets are located.

3. Landlord rental income tax rise 

From 2027, new property income tax rates on rental earnings will apply with the new rates set at 22%, 42%, and 47% for basic, higher, and additional taxpayers respectively.

While the feared introduction of National Insurance on rental income didn’t happen, this increase could reshape the buy-to-let market. Landlords may absorb the cost, or pass it on to their tenants, potentially driving rental prices higher.

What does this mean for the property market?

It means certainty, for now. After months of speculation, the Budget provides clarity for homeowners and investors. Combined with the Bank of England’s signal that inflation has likely peaked and predictions that interest rate cuts could follow in 2026, the outlook isn’t entirely bleak.

Despite the changes, UK house prices continued to rise in November, underscoring the market’s resilience.

Looking ahead

When things keep changing, having a clear plan makes all the difference. Property markets have their ups and downs, but they tend to balance out over time, so think about how your property fits into your wider financial picture and future plans and be ready to adapt.

While these Budget changes won’t take effect immediately, they give wealthy individuals with UK property the chance to pause and regroup – and for those without a wealth plan, now is the time to speak to a wealth planner for guidance and peace of mind.

For more information, please get in touch.

Sources:

Properties worth more than £2m in England face new mansion tax – BBC News

Autumn Budget 2025: What does the Budget mean for housing? | Property news

Savills UK | Budget Reaction – UK Residential Property Market

UK house prices rise despite budget tax fears, says Nationwide | House prices | The Guardian