Hypothesis over property tax adjustments forward of the November Funds has contributed to a drop in purchaser demand and gross sales agreed throughout the nation, in accordance with Zoopla’s newest Home Worth Index.
The uncertainty has pushed year-on-year falls in home costs throughout London and southern England for the primary time in 18 months, whereas extra inexpensive areas proceed to see value development.
Rumours of extra taxes on houses over £500,000 prompted a 12% decline in purchaser demand and fewer gross sales agreed within the 4 weeks as much as 23 November, in contrast with final yr. The influence has been most pronounced in southern England, with London and the South East down 0.1% and the South West down 0.2% yr on yr.
In the meantime, the broader UK housing market stays resilient, with common costs up 1.3% to £270,200, and areas exterior the south, such because the North West, recording 2.9% annual development.
Yr on yr home value inflation by English area and nation
The market uncertainty that plagued the previous few months has been largely dissolved following the Autumn Funds, with the measures instantly impacting the housing market proving much less vital than many dwelling house owners had feared from the hypothesis.
Crucially, the shelving of any proposals for a brand new annual property tax on houses over £500,000 might be welcome reduction for the house owners of the 210,0002 houses on the market above this degree throughout the UK. The removing of the specter of further taxes is ready to ship a a lot wanted increase to purchaser demand and general market exercise at first of 2026. Sellers in southern England will see the best increase as extra houses on the market are above £500,000 – that is vital at a time when home costs are beneath strain from a higher provide of houses on the market.
Proportion of houses at the moment on the market over £500,000 by area & nation:
Whereas the specter of wider tax adjustments impacting the mainstream housing market has been eliminated, stamp responsibility stays a big hurdle for dwelling patrons, particularly in southern England. The stamp responsibility value thresholds for current dwelling house owners had been set in 2014, whereas home costs are 47% larger over this time. That is creating ‘fiscal drag’ for dwelling patrons within the housing market with patrons of common priced houses paying extra
Since 2019, the variety of houses purchased by current owners the place the price of stamp responsibility is greater than 2.5% of the acquisition value has jumped from 21 per cent to 33 per cent. The price of shopping for is rising for common dwelling patrons in cities throughout the south of England and the case for the abolition of stamp responsibility as a part of wider property reforms stays a robust one.
Richard Donnell, government director at Zoopla, stated: “The Funds bark was worse than the Funds chunk for the housing market. Dwelling patrons and sellers will welcome the top of the uncertainty that has stalled housing market exercise for the reason that late summer time. Our information exhibits the underlying demand to maneuver dwelling stays robust. With higher certainty we count on a rebound in housing market exercise that builds into the brand new yr with households who paused dwelling shifting selections over latest months return with higher confidence.
“The removing of the specter of a brand new annual property tax from 210,000 houses is especially optimistic for the market and can assist revive exercise in higher-value areas throughout southern England the place home costs are beneath strain.”
UK-wide purchaser demand and gross sales previously 4 weeks
Desk 4: % of Stamp Obligation paid on home purchases in 2019 vs 2025
