Budget Advice I've been sharing with my clients.
The Budget has taken the heat out of the room. Many people expected something far more severe. Instead we received a small annual levy that most households in this price range can absorb. When the fear is heavier than the reality, confidence tends to come back quite quickly. That is exactly what we are seeing now. From a financial point of view, the fundamentals are unchanged. Liquidity is steady. Borrowing conditions feel familiar. And the levy itself is modest. £7,500 a year on a home above £5,000,000 comes to £52,500 over a normal 7 year ownership. At this level it does not move value.
Stamp Duty
Here are the accurate figures for Stamp Duty Land Tax receipts from the latest official data for the 2023 to 2024 financial year.
SDLT raised approximately £11.6B in 2023 to 2024. In 2022 to 2023, SDLT receipts were £15.4B That means SDLT receipts fell by around 25% in a single year.
We are still waiting for this year’s numbers, but based on market behaviour it is reasonable to expect that receipts may fall again. It shows how unstable stamp duty is as a long term revenue stream.
Alongside that.
98% of UK homes sit below the £2,500,000 and £5,000,000 thresholds. A small group pay this today, but the principle now exists for everyone. OECD data shows the UK leans far more heavily on transaction taxes than most developed markets, including the US, which prefer annual property taxes for stability. Smaller investors will feel this more directly. Any recurring cost reduces yield and for many those yields are already tight. Inflation, even without real house price growth, will gradually pull more homes over these thresholds unless the bands rise with the market. This is how more properties get captured over time. London will feel these shifts first simply because more properties sit close to these thresholds.
Politically, the intention feels deliberate. The government introduced the smallest possible annual charge. It is light. It is digestible. But it introduces a habit. Once people are used to paying something each year, future governments can adjust the level with very little friction. If this becomes the basis of a new tax structure, this will be the moment we look back on.
Or no Stamp Duty...
It is sensible to consider this possibility. We may well be at the beginning of a shift towards a broader annual tax and a softer reliance on heavy upfront costs. We do not know for certain, but the architecture for that shift now exists. This is simply marking your card so you are aware of how this could evolve.
Personally, I think this could create a more dynamic market. Lower upfront friction would allow people to move more freely. Transactions would happen faster because the perceived risk is reduced and there will be more of them.
It is worth keeping an eye out for further rhetoric around the potential removal or reduction of stamp duty. These ideas are no longer fringe.
Activity Since the Budget
We had a number of deals straddling the Budget that have now crossed the line, with happy buyers and happy sellers on both sides (thankfully). We also have another circa £33,220,000 under offer. We are optimistic that these transactions are now more likely to exchange and a couple may complete before the end of the year.
It also seems clear that buyers who have been looking for the past 12 months are now pulling triggers. One recent exchange happened at £4,999,000 rather than £5,000,000, but at this level what's £1,000 between friends. It speaks to the psychology of thresholds more than the economics.
Emotions
The emotional response in the market has been exactly what you would expect. Buyers who paused for the Budget now realise nothing material has changed. Sellers feel steadier and some may feel tempted to push their pricing. This is where calm judgement matters.
A Reminder Worth Saying Out Loud
A committed buyer today is often worth more than the hope of a slightly higher price tomorrow. A bird in hand is worth 2 in the bush. That line has survived decades in agency because it is true. Confidence is good. Overconfidence is costly.
There is also another factor starting to support the mood. It is becoming increasingly likely that we may see a rate cut of 0.25% before the new year. It is small, but small good news is still good news. It helps the market breathe and it gives next year a gentler starting point than anyone expected a few months ago.
So the picture is this. The Budget has removed fear without creating disruption. It has given people room to act. And it may have quietly opened the door to a new tax model that grows over time. For now, the right approach is awareness, grounded thinking and steady decision making.
If you would like more information and advice regarding the UK's Autumn Budget, please send Daniel a message here.
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