Autumn Budget Property Update

Economic uncertainty, higher mortgage rates and pre-budget speculation have softened the traditional autumn market bounce.  Increases in mortgage rates are squeezing buyers’ budgets, prompting price falls even in some of the more affordable regions of the UK.  

The latest Zoopla House Price Index shows sales agreed are 7% lower than a year ago, and stock is 7% higher.  UK house prices rose 0.8% over the last year, with the average house price in the UK reaching £273,100, but the national average doesn’t always reflect what’s happening locally.  The biggest pressure on prices is in southern England.  House prices are generally higher, so higher mortgage rates tend to have a bigger impact on what buyers can afford.  Local market knowledge has never been more important. 

So, what did the Budget hold for the property industry? 
 

• The new Your First Home scheme will provide government-backed equity loans to help eligible buyers purchase new build homes in England.  The government is expecting the £4.7bn scheme to support around 70,000 first-time buyers and 20,000 new homes. Pre-registration is expected to open by the end of December 2026, with full applications from February 2027 and the first loans from April 2027.  Eligibility will depend on household income and local property price caps. The income cap is £110,000 outside London and £140,000 in London, with price caps based on local authority median prices. The scheme also includes a five-year interest-free period on the equity loan.
• New first-time buyer ISA to replace the Lifetime ISA. The Chancellor has announced plans for a new first-time buyer ISA, with changes to allow Lifetime ISA savings to be withdrawn without the previous penalties.  This will launch in 2029, offering a 25% government bonus on savings used to buy a qualifying first home worth up to £450,000.
• Landlords face a further increase in property income tax, with rates rising by another two percentage points from April 2027, on top of the increase announced in the 2025 Budget.  From 6 April 2027, property income tax rates will rise by a further two percentage points, taking the basic rate to 24%, the higher rate to 44% and the additional rate to 49%. 
• The Budget includes a £100 energy payment for approximately 20 million households in council tax bands A–D, an extension of the electricity VAT reduction to July 2027 and changes to gas standing charges.  
• The UK Government is committed to ending rough sleeping.  Since July 2026, £442 million has funded routes off the streets, support services and settled accommodation. The Budget adds £432 million for 2027/28 and 2028/29 to continue this off-the-streets offer.

Whilst not a huge amount to stimulate activity, in our view the best thing for the housing market could simply be that now the Budget is over, we have some clarity. Affordability is still a key issue; the direction of mortgage rates will influence how the housing market shapes up in 2027.  

Despite economic and political uncertainty, moving demand remains strong.  In the same Zoopla House Price Index, they report that houses which are priced correctly are securing a buyer within 44 days, underlining the importance of setting realistic prices from the outset. 

If you are looking for any help or advice, we would be delighted to help.  Contact your nearest branch today.  

Source:
Zoopla House Price Index
Zoopla Autumn Budget