26th November 2025
With the arrival of the much speculated 2025 budget, many in the property market breathed a huge sigh of relief…
Yes, Rachel Reeves announcements today will have an impact on the property market, but overall, what has been more damaging to the market is the slow down we have seen in the lead up to the budget - while speculation ran wild and buyers ran scared!
With today's announcement, homeowners and buyers can now at least evaluate the impact of their house move with less speculation and more certainty - which can only be a good thing!
One of the major changes to property tax was The Chancellor of the Exchequer's announcement of the introduction of High Value Council Tax Charges - also known as a "Mansion Tax". The tax, to be imposed from 2028, will see properties valued at £2M-£2.5M being charged an annual surcharge of £2,500; properties from £2.5M-£3.5M will pay £3,500 per annum; houses valued at between £3.5M-£5M will pay a yearly surcharge of £5,000; and properties valued at over £5M will pay £7,500 per year. It is reported that the Valuation Office will conduct a targeted valuation exercise to identify properties above £2 million.
Landlords will face increased property tax rates from April 2027 with the basic, higher and additional rates of income tax for property income each increasing by 2% (taking them to 22%, 42% and 47% respectively).
The widely-speculated new Property Tax on homes over £500,000 will not be introduced, this will be a relief to many homeowners and will provide a boost for the market after months of hesitation.
Reportedly, fewer than 1% of homes in England are worth £2 million or more. Most of these are located in London and the South East, including Surrey. In Surrey, we might expect to see more properties over the £2M price point coming on to the market - as homeowners are motivated to downsize or move to avoid the additional surcharge. It's possible that with the introduction of the tax we'll also see a downward price pressure on homes valued just above each threshold - as buyers seek properties below the limit to avoid the surcharge. This could lead to price bunching as properties worth just below £2 million become far more desirable than those worth just above. Although it's unclear at this point how the valuations will be carried out and whether sale price will have any impact on the calculated tax charged.
With clarity on the budget, buyers and sellers can finally now calculate the impact of their purchase or sale and can move forward with their future plans. Are you ready to looking to find your next home?
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If you are looking to move to Surrey, please do get in touch with Surrey HomeSearch - we'd be delighted to help make your dreams of the pefect home a reality!