The Autumn Budget 2025 is fast approaching, falling later in the year than any Autumn Budget I can recall.
Perhaps the Chancellor pushed it back towards the end of the calendar year in the hope that the economic outlook might have improved over time? Or maybe she hoped that the national mood, buoyed by thoughts of mulled wine and mince pies, might be more relaxed about tax increases and spending cuts by November 26?
One way or another, I don’t believe we can expect much else. In fact, a Telegraph article last week suggested that the Treasury may be considering as many as 100 different tax increases to deal with the black hole the country’s finances are facing.
National nerves are jittery – and that includes here in North London, where the local housing market is tightly linked to economic sentiment and the behaviour of financial markets. Perhaps here in the capital, fiscal uncertainty is felt more sharply than in other parts of the UK.
Over recent weeks we have watched markets react to leaks, counter-leaks, and even an impromptu speech by Rachel Reeves in which she dropped the biggest hint there could be that income tax would be increased – which of course would break a manifesto pledge.
That last however was followed shortly after by a U-turn on the idea, one that came on back of a flurry of other policy reversals this government has made. Without pinning any particular party colours on my chest, this has frankly been a level of political mixed messaging that would give even seasoned economists pause.
It is no wonder so many homeowners and landlords across Edgware, Mill Hill, Stanmore and beyond are wondering what on earth next Wednesday will bring.
Whilst all the above is why no one can predict exactly what the Budget will bring on November 26, we can see the direction of travel; and that allows us to speculate with a little more clarity on some of the most likely implications for our world of property, when it comes to tax increases, reforms, spending cuts – and possibly even the odd sweetener, too, as unlikely as that feels to many.
Here, then, is our Petermans Estate Agents view of the economic landscape, the political volatility that is shaping it, and the key things that London homeowners and landlords should keep an eye on during Rachel Reeves’ speech next Wednesday.
Even before the latest bout of political turbulence, the UK economy had been moving at a slow crawl. Now, heading towards the final fiscal event of the year, several indicators paint a picture of continued strain.
Here are some key points shaping the landscape as we enter the final week before the 2025 Autumn Budget:
GDP has nudged upward, but only a fraction: 0.1% in the third quarter, following a monthly contraction in July. Business confidence remains fragile as a result and hiring intentions are still subdued, affected by those employers’ National Insurance increases ushered in at last year’s Budget. Unemployment in fact has now hit 4.8% - now the highest level it has been since 2021.
Inflation has been hovering around double the Bank of England’s target for months, holding at 3.8% since July – although on a rare positive note, it has at least not risen to the 4% level that markets and analysts had predicted.
It does remain stubborn however, still to come down from that 3.8% mark; and stubborn inflation means stubborn interest rates.
The Bank of England’s decision to hold the base rate at 4% was anticipated by many, but not all. Some analysts had expected a cut last month, particularly after the Chancellor’s impromptu pre-Budget speech which all but promised income tax rises were on the cards – something that might have angered voters but which would settle market nerves; something, as it happens, which typically cools inflation.
The Monetary Policy Committee (MPC) did not take that bait, however, voting 5-4 to hold rates at 4% rather than cutting to 3.75% - although a 0.25% cut before the year end became more widely expected at the time.
Then came the U-turn, though. Income Tax would not be increased after all. And with that, the market’s growing confidence in a rate reduction evaporated just as quickly.
In practical terms, mortgagees and those remortgaging continue to face:
Even minor policy wobbles at national level can push lenders into more cautious behaviour, and that caution directly affects the property market.
10-year gilt yields have dipped, usually a positive sign for mortgage pricing. Nevertheless, volatility remains. London’s property market reacts quickly to bond movements, and recent weeks have been a reminder of that.
London often behaves differently to the rest of the country. Rightmove’s House Index data and official sold-price figures from the Office for National Statistics and mortgage lender indexes all point to low property price growth over the past 12 months. Slight, but nevertheless growing.
That said, the London market – including here in Edgware – has seen prices fall, with sold prices dropping in London by 0.6% according to the ONS.
Across London, therefore, it turns out that sold prices have been far more resilient than headlines have often suggested. Whilst asking prices have dipped – by quite extreme amounts in some pockets – transactional values have rallied over the past few months, to have now largely held steady over the course of 12 months.
A price drop of 0.6% feels more like a market that has flatlined rather than fallen – although, we must note that it means property values have fallen behind inflation.
In the meantime, many landlords continue to reassess. With regulation changing, costs increasing and margins tightening, the pressure on landlords is mounting.
It means that even whispers of fresh taxation could push more landlords into selling.
Much change could from this Budget, but we will leave it to others to go into the detail of all those possible tax increases and spending cuts.
Our focus, naturally, is on those areas that will be most relevant to North London property owners.
Here are our Top 7 things to look out for if you own, let out or are thinking of buying a property in Edgware and the surrounding area:
1. Stamp Duty Reform
There is increasing speculation that stamp duty may face real structural reform. Possibilities that have circulated include:
If stamp duty is reformed by way of a new property tax imposed on higher value property transactions, we can see how it would disproportionately affect London and the South East of England, where the value of the average home surpasses other regions.
2. Council Tax Rebanding
New higher-value council tax bands may be on the horizon, with homes in London and the South East thought to be most likely to feel the brunt.
3. Capital Gains Tax on Main Residences
One of the more controversial ideas currently gaining traction – although generally seen as less likely to come to fruition – is whether a tax could be levied on any capital gain made on primary residences.
There has been some suggestion that property sales could be taxed on gains above a threshold, with £1.5m being the threshold we have seen discussed. It is something that could pull many North London homes into the net now, let alone over time. Compared to other parts of London, Edgware itself has fewer homes priced at that level. That said, as values increase – as they historically do – more and more Edgware sellers would be caught up in that number.
4. Income Tax, National Insurance & VAT
It looks like the government will steer away from direct income tax rises after all, but given the need to fill a fiscal black hole we are likely to see some income-related stealth taxes instead.
These could include:
For local landlords, one tax change that could materially affect yields is the potential introduction of National Insurance on rental income.
Research shows that this could affect around 360,000 landlords, many of whom are based in London, reducing rental yields for some by up to 10%. We feel that this in particular is something to look out for next Wednesday.
5. Inheritance and Wealth Taxes
There could be moves toward wealth-based taxation, and most likely these will be focused on property. Higher-value homes could face tightened thresholds or expanded definitions when it comes to taxable assets.
6. Landlord Regulation & Renters’ Rights
With the Renters’ Rights Act and Making Tax Digital both increasing compliance demands, landlords should prepare for:
A Budget sweetener for the PRS is possible, but far from guaranteed – however, incentives for landlords to make green improvements could be on the cards, in an attempt to encourage wavering landlords to hang in there.
7. A Mortgage Market Sweetener?
There is growing speculation in some quarters that we may see renewed support for first-time buyers, which could include:
Incentivising first-time buyers and younger buyers in particular would be welcomed, kickstarting chains and allowing long-term renters to step into home ownership, freeing up rental property in an under-supplied market – something that we would very much welcome here in Edgware.
If the last few weeks, or even months, have shown us anything, it is that forecasting is a fool’s game.
Even insiders, professional economists and market analysts are entirely divided on what we are most likely to see.
What feels safe to say is this: uncertainty itself is now a defining feature of the property market.
Of course, uncertainty is what can cause volatile mortgage pricing, jittery buyers, over-cautious lenders, and as a result slower sales cycles.
For homeowners and landlords in Edgware and the surrounding area, there is a lot to look out for next week. But not all of it is necessarily going to be bad news. There will inevitably be tax increases – of that I think we have no doubt. But in some areas, for example, stamp duty particularly, we might just see tax reductions which might yet galvanise the market.
The way that financial markets react to next Wednesday’s announcements, and what effects that could have on general inflation and interest rates, may be more critical to the property market’s outlook than any direct changes we see next week.
Whatever the Chancellor announces next week, we will be ready to break it down for you, to explain the implications, analyse the effects on the local housing market and support you in making informed decisions about moving or letting out a property in Edgware.
One thing to remember, despite any uncertainty you might feel, is that the property market here is resilient. It always has been.
Nevertheless, now perhaps more than ever, strategic advice that is grounded in local expertise is essential.
Look out for our post-Budget summary next week, where we’ll cut across the noise, dig out the detail, and outline what it all really means for homeowners, landlords and buyers across Edgware.
1. Will the Budget affect property taxes?
Stamp duty reform, council tax rebanding and various property-based wealth taxes are said to be in contention. There is an outside chance we will see Capital Gains Tax on primary residences. These sorts of taxes could all impact London homeowners.
2. Are mortgage rates likely to fall after the Budget?
There is a chance, but it may not happen immediately. Political instability influences markets, and lenders remain cautious. Any change will depend on inflation and gilt yields, and how the Bank of England responds as a result when considering further cuts to the base rate.
3. Should landlords expect more taxes?
This may be one of the more likely changes we will see, but it is not certain. One of the more likely outcomes is that we may see National Insurance levied on rental income. It is thought that this could affect around 360,000 landlords, including many in London.
We are required by law to conduct anti-money laundering checks on all those selling or buying a property. Whilst we retain responsibility for ensuring checks and any ongoing monitoring are carried out correctly, the initial checks are carried out on our behalf by Lifetime Legal who will contact you once you have agreed to instruct us in your sale or had an offer accepted on a property you wish to buy. The cost of these checks is £60 (incl. VAT), which covers the cost of obtaining relevant data and any manual checks and monitoring which might be required. This fee will need to be paid by you in advance of us publishing your property (in the case of a vendor) or issuing a memorandum of sale (in the case of a buyer), directly to Lifetime Legal, and is non-refundable. We will receive some of the fee taken by Lifetime Legal to compensate for its role in the provision of these checks.