The Autumn Budget was the first delivered by Chancellor Rachel Reeves under the new Labour government. We caught up with experts from across the business to gain an insight into their mixed reactions and learn more about how the announcements would impact the property sector.
Partner and Head of Development, Ben Marshalsay, said “We have had a bumper October as landowners looked to complete ‘beat the Budget’ deals. However, the announced increase in Capital Gains Tax isn’t as bad as first thought, and I expect it to be business as usual for any deals that did not get over the line.
“Housebuilders are already reacting positively to the plans announced by the government, and while it may take a bit of time, I expect today’s budget will positively affect land values. As interest rates fall, more buyers will be in the market, which will result in more housebuilders looking to build new homes.”
Alasdair Dunne, Partner and Head of Residential Agency said: “There were no major surprises for the residential sector in today’s Budget. The increase in stamp duty for second homes will negatively affect the appetite of the buy-to-let market, but the increase was not as steep as it might have been.
“And while Capital Gains Tax increased on property in areas like the commercial sector, it stayed the same in the residential sector.
“The true drivers of the residential market are interest rates which are predicated on the BoE base rate. With the financial markets responding relatively well to the Budget, we will continue to see the planned base rate cuts, albeit they might be delivered a little slower than anticipated.”
Head of New Homes, Ella Pearson, added: “The increased investment in affordable homes promised by the Chancellor – significantly more than what was expected - is positive news for small to medium-sized new-build developers which typically have fewer affordable homes on site. The hope is that this will increase the appetite of housing providers as their risk is reduced.
“This will ultimately mean that more affordable homes will come onto the market, giving more people the chance to get on the property ladder.
“First-time buyers will also be pleased with the Government’s pledge to engage with the industry around the Mortgage Guarantee Scheme and make it permanently available to support loan-to-value lending of 95 per cent. If these plans are followed through, it should stimulate the market further.
“However, the increase in Capital Gains Tax on second homes will result in fewer buy-to-let transactions, resulting in a reduced appetite for holiday homes.”
Richard Gadd, Head of Farms Agency, said: “Whatever the Chancellor says, the decision to reduce agricultural and business property relief to 50 per cent for property above £1m will affect all but the smallest of farms.
“This announcement will have far-reaching consequences across the agricultural industry and as a result, we would expect to see more farms considering potential sales of farms or part of their holdings over the next few years along with potential restructuring options, at a time when British farmers need to be supported.
“The age profile of agricultural property owners and their potential successors will of course impact decisions and restructuring options, but we do expect a significant amount of professional advice to be sought in the very near future.
“Importantly, there is sufficient time before the tax amendments come into force in April 2026 to consider all options and secure that critical professional guidance.
“The move may well affect farmland values in time if supply does increase dramatically, but to what extent is yet to be seen. We expect a softening in demand from a proportion of buyers who are seeking land and agricultural holdings with inheritance tax reliefs in mind or where agricultural property relief is the principal driver.”
Partner and Head of Investment, James Routledge, said: “Increases to Capital Gains Tax were expected from today’s Budget, but the increases announced were not as bad as the market was fearing.
“Investment into commercial property was starting to recover anyway for cyclical reasons, with income return the key driver rather than Capital Gains Tax, so this rise should not affect this investment trend dramatically. Similarly, the changes to non-dom status will not affect the bulk of the market either.
“In addition, a calmer UK bond market and reduction in interest rates should encourage an uptick in transaction levels and strengthened investor sentiment.
“The biggest impact will be on the buy-to-let market in the residential sector, with increases in stamp duty on second homes rising from three per cent to five per cent. We would expect fewer buy-to-let landlords investing in residential property for those reasons.
“Overall, we would expect the Chancellor’s Budget to only have a minimal impact on investor behaviour. We will continue to monitor activity closely in the wake of the Budget and advise clients accordingly.”
Jonathan Young, Head of Business Rates, said: “We were promised radical reform of business rates, but that is not apparent in the first Budget delivered by our new Labour government.
“Next year we will continue to see business rates relief for the Retail, Hospitality and Leisure (RHL) sectors, with a relief of 40 per cent capped at £110,000 per business, although this still means that, for qualifying businesses, their liability will still have virtually doubled when compared to the current year when they benefitted from 75% relief whilst the cap of £110,000 per business remains the same.
Going forward, from 2026/27 there will be a reduced multiplier for the RHL sector paid for by a higher multiplier for properties with Rateable Values above £500,000.
Whilst this ongoing assistance for the sector is very much needed greater support on business rates was required.
A further announcement was the expected confirmation that private schools would lose their existing 80% charitable relief from the 2025/26 tax year which will obviously lead to considerably increased costs for a sector which is also now subject to VAT on school fees from 1st Jan 2025.
It is also noted in the supporting paper ‘Transforming Business Rates’ that the duty to provide information annually to the Valuation Office Agency (VOA) will only be formally activated and mandated in time for the 2029 Rating List which commences on 1st April 2029.”
Darren Edwards, Head of Green Energy & Sustainability, said: “While the budget once again outlined the Government’s plans to make Britain a clean energy superpower, most of the headline information, such as the formation of Great British Energy next year and the funding of new green hydrogen projects, was already widely known across the industry.
“However, confirmation of the invest to grow approach and support for clean energy through the National Wealth Fund was new and consolidated Labour’s recognition of the importance of green energy and sustainable infrastructure.
“The announcements of investment into the electrification of rail lines and further support for the automotive sector and specifically EVs, coupled with the new homes targets, was also interesting but what was missing from the budget was an indication of how these projects will be powered.
“There are already incredible pressures on the electricity grid, and continued investment is needed to ensure there is enough power so that these ambitious projects and targets are successful.”
Managing Partner, Andrew Bridge added: “At Fisher German, we are committed to supporting our clients through these changes. Our team of experts is ready to provide tailored advice and guidance to help navigate the impacts of the Autumn Budget. Whether it’s understanding the implications of tax changes, exploring new investment opportunities, or planning for sustainable development, we are here to ensure our clients make informed decisions and achieve their goals.”
