Rightmove warns budget property tax shake-up could hit London and south-east housing markets

Rumoured property tax changes that could be announced in the Autumn Budget would add pressure on London and the south east, heightening uncertainty in regions that Rightmove says are already “performing less strongly.”

Speculation that the government may introduce measures including a national proportional property tax on homes worth more than £500,000, a mansion tax on properties above £1.5 million and the imposition of national insurance contributions on landlords has circulated widely ahead of a Budget expected at the end of November. Coleen Babcock, a property expert at Rightmove, said the rumours began in mid‑August and that prolonged uncertainty can affect market activity, particularly in higher price brackets, as owners and buyers reassess short‑ and medium‑term plans.

Rightmove’s analysis found the impact of the proposed stamp duty change on properties above £500,000 would be concentrated in London: nearly 60% of sales in the capital would be affected, compared with 22% across England and 8% in the North East. The portal said 11% of homes in London are priced at £1.5 million or more and would be subject to the rumoured mansion tax, versus an average of 2% outside the capital, a disparity it warned could exacerbate regional divides.

Market data from Rightmove showed Britain’s average listing price rose by £1,517, or 0.4%, in September to £370,257, but seller asking prices were 0.1% lower than a year earlier following several months of muted price growth. Rightmove said the dip in annual prices was driven by London and the south of England, where competition among sellers has been stronger and inventory growth more pronounced.

The number of homes for sale in the south of England was up 9% year‑on‑year, compared with a 2% increase in the rest of Great Britain, and it took an average of five days longer to find a buyer in the south. Sales being agreed across Britain were 4% higher than at the same time last year, with a 3% rise in the south and a 5% increase elsewhere. Regionally, asking prices in the south west were down 1.3% year‑on‑year while the north west recorded a 3.2% gain; the West Midlands was the only more northern region to see an annual drop in new seller asking prices.

"Our analysis highlights how London and south England‑centric the changes would be, and these are the areas that are already performing less strongly," Babcock said. She added that competitive and realistic seller pricing had helped boost sales activity compared with a year ago, aided by static house prices, rising wages and a fall in mortgage rates since summer.

Estate agents and lenders said market behaviour varies by price band and location. Jeremy Leaf, a north London estate agent and former Royal Institution of Chartered Surveyors residential chairman, noted that Rightmove tracks asking prices rather than achieved sale values and cautioned that some vendors remain unrealistic about pricing. "Unless your property is realistically priced you won’t stand out from the sizeable crowd and give yourself the best possible chance of attracting offers," he said.

Tomer Aboody, director of specialist lender MT Finance, warned that first‑time buyers continue to struggle with affordability, noting average property prices remain higher than common income multiples. He urged stamp duty reform and policies that free up homes for downsizers to boost supply and help first‑time buyers, saying the property cycle is a major economic focal point.

Monetary policy developments have also helped reshape the market this summer. On Aug. 7 the Bank of England cut its base rate from 4.25% to 4%, the lowest since March 2023; analysts broadly expected the Bank to hold rates in September. Lenders and brokers say buyers and remortgagors seeking to lock a mortgage rate should compare options early and allow time to secure deals as fixed‑rate periods end.

Rightmove said it had not yet detected major market shifts attributable to the tax rumours but warned that the prospect of policy changes concentrated on higher‑value properties could further depress demand in already weaker areas. With the Budget not due until late November, the portal cautioned the extended period of speculation could weigh on activity at the top end of the market and influence vendor strategies over the autumn.

Any government proposals that disproportionately affect London and the south east would be felt amid a backdrop of higher inventory in those regions, relative price softness and an ongoing debate about how tax and policy settings can rebalance housing market performance across the country.