Chancellor Rachel Reeves delivered her second Autumn Budget on 26 November 2025, and if you’d been following the headlines in the weeks beforehand, you’d have been forgiven for thinking major changes to property taxes were on the cards. There was talk of stamp duty being scrapped, capital gains tax being extended to main residences, and various new property levies being introduced.
The reality turned out to be far less dramatic. While there is one notable change affecting owners of high-value properties, the sweeping reforms many people feared simply didn’t materialise. Here’s what you need to know about how the Budget affects property transactions and ownership.
The new high-value property surcharge
The main property-related announcement is a new council tax surcharge on homes valued over £2 million, which will come into effect in April 2028. This has already been dubbed the ‘mansion tax’ by the media, and it’s expected to affect fewer than 1% of properties across the country, raising around £0.4 billion by 2029-30.
The surcharge works on a sliding scale based on property value. Homes worth between £2 million and £2.5 million will face an annual charge of £2,500, rising incrementally to £7,500 for properties valued at more than £5 million.
While this only affects a small proportion of homeowners, it does raise genuine concerns, particularly for those who are asset-rich but cash-poor. We’re thinking especially of older homeowners who’ve lived in the same family home for decades and may find themselves facing annual charges they struggle to meet from their income.
If you own a property that might fall into this bracket, the April 2028 start date at least gives you time to plan ahead. We’d recommend seeking advice well before then so you can properly understand your options and make informed decisions about your property and wider estate planning.
What stayed the same: stamp duty
Despite months of speculation about stamp duty being reformed or even abolished, the rates and thresholds remain exactly as they were before the Budget.
First-time buyers continue to pay no stamp duty on properties up to £300,000 (provided the property costs no more than £500,000 overall). For everyone else, the nil-rate threshold stays at £125,000. The 5% surcharge that applies to second homes and buy-to-let properties, which was increased in last year’s Budget, is still in place.
If you’re buying a property now or planning a purchase in the near future, this means you can budget with certainty. There are no surprise costs to factor in.
No capital gains tax on your main home
One of the biggest worries circulating before the Budget was the possibility of capital gains tax being introduced on main residences, particularly high-value homes. Some reports suggested CGT might apply to properties sold for over £1.5 million or £2 million.
This didn’t happen. Principal Private Residence Relief remains fully intact. When you sell your main home, you don’t pay capital gains tax on any profit you’ve made, regardless of the property’s value or how much it’s increased since you bought it. This is welcome news for homeowners right across the country.
It’s worth remembering that this relief has always applied only to your main residence. If you own a second home, holiday property or buy-to-let investment, capital gains tax does apply when you sell, at the current rates of 24% for higher-rate taxpayers and 18% for basic-rate taxpayers. These rates were set in last year’s Budget and remain unchanged.
What this means for you
If you’re buying
You can move forward with your purchase plans knowing that stamp duty rates are stable. Make sure you’re budgeting for all the associated costs beyond stamp duty itself: legal fees, surveys, removal costs and any immediate works the property might need. Getting your finances organised early and instructing an experienced conveyancing solicitor will help ensure everything runs as smoothly as possible.
If you’re selling
If you’re selling your main home, you can do so without worrying about capital gains tax. For those with properties valued over £2 million, while the new surcharge doesn’t come in until 2028, it’s worth considering your long-term plans and whether now might be the right time to review your property portfolio.
If you’re a landlord or property investor
Capital gains tax continues to apply to investment properties at the rates set in the previous Budget. If you’re considering selling a buy-to-let or second home, make sure you factor CGT into your calculations when working out your potential returns.
How we can help
Property transactions involve significant financial and legal considerations, and staying on top of policy changes is part of how we support our clients through the process. Whether you’re a first-time buyer, moving to a new home, investing in property, or concerned about how the high-value property surcharge might affect you, we’re here to provide clear, practical advice.
Gayle Fordham is a Partner and Head of our Residential Conveyancing team.
If you have questions about how the Autumn Budget affects your property plans, or if you’d like to discuss anything else related to buying or selling property, please do not hesitate to get in touch with Gayle on 01206 835225 or complete our online enquiry form.