Speculation around wide-ranging property tax reforms is already having a cooling effect on the UK housing market, according to new research.
Chancellor Rachel Reeves is reportedly considering major changes, including replacing Stamp Duty with a national property tax on sellers, applied to transactions above £500,000. The Treasury is also said to be exploring a wealth tax or capital gains charges on sales above £1.5m. Any announcements would likely come in the Autumn Budget this November.
Sellers Holding Back
The uncertainty is prompting caution among homeowners. Analysis by data firm PriceHubble shows:
- New listings fell 6.1% in the second half of August compared to the first.
- Withdrawals jumped 23%, with the sharpest increase (+27%) in homes under £500,000 – the very properties most likely to gain from a Stamp Duty cut.
- High-value homes (£1.5m+) saw a small uptick in listings, as owners look to sell before any potential new capital gains or wealth taxes are introduced.
Agents Reporting Fewer Deals
Nearly half of estate agents surveyed noted:
- Fewer new listings
- Reduced buyer demand
- More sales falling through
Around a third said listings have slowed noticeably since the tax rumours surfaced, with downsizers in particular delaying decisions until the Autumn Budget provides clarity.
Market in “Holding Pattern”
PriceHubble commented:
“Over the next few months, the UK housing market is likely to enter a holding pattern. Sellers at the top end may accelerate deals, while buyers at the lower end may wait for clarity. The final shape of the reforms remains to be seen, but the impact of the rumours is already clear: fewer listings, more withdrawals, and an increased risk of a slowdown in transactions.”
For estate agents, lenders, and policymakers, the key concern now is not only what changes will be confirmed in November, but also how much the speculation itself will have slowed the market in the meantime.
