Autumn budget 2026: relief for home movers, breathing space for renters

Home movers have been anxiously waiting to hear how the Autumn Budget 2026 will affect the property market, amidst swirling rumours of further tax hikes.

Over the months leading up to his autumn Budget, Chancellor John Healey has had much to consider. Sky-high fuel prices, pressure to increase defence spending and the rising cost of living have all played a part in his calculations.

Meanwhile, Mr Healey has enjoyed some positive news on the  economic front. In the three months to August, unemployment figures fell and the British economy unexpectedly grew by 0.7 per cent. 

The International Monetary Fund (IMF) has predicted that Britain will have the second-fastest growing economy in the G7 group of countries this year. The Office for Budget Responsibility (OBR) has also forecast that the economy will continue to grow over the next three years.

But how does the Budget affect homeowners and homebuyers? Can they expect further property tax changes? The UK government has already expressed its commitment to building new homes. It also wants to encourage more young people to set foot on the property ladder through the ‘Your First Home’ scheme.

There’s a wealth of detail to consider, so let’s get down to the key points affecting  buyers, sellers, renters and landlords.

Help for UK First Time Buyers

Your First Home is a government-backed equity loan scheme helping first-time buyers purchase a new-build home with a deposit of just 2.5%. These buyers will qualify for a loan worth 20% of their property's value through the scheme. 

The eligibility threshold will be £110,000 for loans on regional properties, but London buyers have welcomed the move to increase the threshold to £140,000 in the capital.  Additionally, a new First Time Buyer ISA will launch in 2029.

Relief for buyers and sellers

Pre-budget speculation has caused sales in some prime London areas to drop by between 5 and 17 per cent. The Chancellor’s decision not to pursue controversial proposals that arose in the run-up to the budget will bring relief to many home movers.

Help with Lifetime ISA (LISA): the government's plan to reduce the Lifetime ISA (LISA) penalty charge to 20% will be a boon for London buyers purchasing properties above the original £450,000 cap.

How can I be sure of setting the right price?

In prime London boroughs it is common to find micro-market price variations across a single street or even within the same apartment block. A professional valuer will look beyond your home’s size, lease duration, age and condition to consider a number of other factors. These include local transport links and proximity to local shops, schools, leisure facilities and parks. A good view, access to outdoor space, the presence of a concierge or the availability of gym or pool facilities will also form part of the valuer’s calculation.

‘Mansion Tax’ threshold unchanged: Before the budget there were rumours that the threshold for the High Value Council Tax Surcharge would be reduced from £2 million to £1.5 million, but the Chancellor has chosen to avoid a further drop. 

No alteration to Capital Gains Tax: the Chancellor has ruled out a proposal to align Capital Gains Tax directly with income tax rates. This comes as welcome news for many sellers, as it would have doubled their tax liability.

Support for renters

John Healey has delivered what he describes as a ‘Breathing space’ budget. This will help to reduce the pressures imposed on renters due to the rise in the cost of living. 

Key changes include: 

• A £100 payment towards energy costs for householders in council tax bands A-D.

• Standing charges on household gas bills to be scrapped, with future plans to remove standing charges on electricity bills.

• The removal of import tariffs on some household staples.

• VAT cut on electricity bills to be extended through to July 2027.

An opportunity for landlords and investors?

Landlords are facing a two per cent increase on the profits from rental income, which will be payable from April 2027. 

The supply of rental properties in London is already tight. If more buy-to-let landlords exit the market as a result of this tax hike, the knock-on effect will be fewer available properties and higher rents.

While landlords will not welcome this tax increase, they could benefit from a stronger demand for London rental properties.

What did the Chancellor leave out of his budget?

Capital Gains Tax (CGT): a possible increase in CGT featured heavily in pre-budget speculation, but the Chancellor has decided against tinkering with rates.

Stamp Duty: despite rumours that UK Stamp Duty could rise, there have been no changes. Earlier plans to replace stamp duty and council tax with an annual property tax have not been mentioned.

Inheritance Tax: the rumoured 10 per cent levy on estates did not materialise. 

How will the property market react?

According to research carried out by Rightmove, approximately 17 to 20 per cent of home movers typically delay making plans until after a budget, due to worries over taxation changes. 

Now that the autumn budget has been delivered and shadow of tax increases has faded, we should see confidence return.

Whether you are buying, selling or letting a property in central London, we are here to help. As a family-run business we offer a truly personal approach, with expertise to guide you through the complexities of the London property market. Simply get in touch with us in Westminster, London Bridge or Kennington to start your property journey.