There’s been a pause in home purchases worth over £500,000 as would-be buyers wait and see what’s announced in the upcoming Autumn Budget.
It’s speculated that homes worth more than £500,000 could be subject to increased taxation. This could be in the form of an annual property tax, or stamp duty costs affecting the seller.
Zoopla research shows that the drop in new sales is most pronounced across southern England, where higher-value properties make up a larger share of the market.
Buyer demand fell 8% year-on-year, effectively starting the usual pre-Christmas slowdown 6-8 weeks early.
However Richard Donnell, executive director at Zoopla, said: “The slowdown is modest and less severe than the impact of the 2022 mini budget. It’s early stage buyers adopting a cautious approach to new purchases ahead of the Budget with greater caution for those buying higher value homes.
“The housing market remains on track for the most housing sales since 2022 and house prices are set to end the year 1-1.5 per cent higher than the start of 2025.”
Sales were down by 3% year-on-year across the UK.
However, they are still up in Scotland (3%), Yorkshire & the Humber (4%), the South West (1%) and the West Midlands (1%).
However, Southern England and Wales are experiencing a sharper slowdown in new sales being agreed, dropping in Wales (9%), the South East (8%), the East of England (6%) and London (5%).
Jeremy Leaf, north London estate agent and a former RICS residential chairman, said: “It’s fair to say worries about the Budget have prompted more buyers and sellers to pause before deciding whether to proceed with their moves.
“However, that doesn’t tell the whole story. On the ground, we’ve also noticed a general lack of confidence about taking on debt and prospects for the economy despite wage rises still exceeding house-price growth and inflation.
“Buyers are not rushing to make up their minds in view of the considerable choice of property available too. Fortunately, a reasonable number of needs-driven buyers still looking to move helps to explain why we’re finding the overwhelming majority of sales agreed are proceeding – albeit more slowly and some only following a little price re-negotiation.”
