Autumn Budget 2026
We’ve been eagerly anticipated labour Autumn budget 2026. With inflation is way above the 2% target (3.6%), yet, higher cost of living (utilities, food, fuel etc.) we were expecting some reassuring news for the housing market & stamp duty.
The Chancellor, Rachel Reeves, has unveiled property tax changes in the Budget today as she seeks to plug a reported £20bn hole.
In her second Budget since Labour came into power, Reeves unveiled a raft of tax rises – but property taxes came away relatively untouched, with the announced changes set to impact a far smaller proportion of the market than anticipated.
It comes after several months of intense speculation about what Reeves might have in store, with rumoured proposals ranging from expanding Capital Gains Tax (CGT), to a levy on rental income.
So, here are the key announcements that are set to shape the housing market and what they could mean for you.
Your First Home Scheme: help to buy a new-build
The government has pledged £4.7bn towards the Your First Home scheme. It’s a new equity loan scheme that we expect to benefit around 30,000 first-time buyers every year.
This is how it will work:
- The loan: the government will provide a 20% equity loan towards your new-build home. You won’t pay interest for the first 5 years, then it rises gradually.
- Your deposit: you’ll have to put down at least 2.5%, but no more than 15%.
- Household income caps: £110,000 outside of London and £140,000 in London.
- Price caps: based on median home prices in your local authority. The cap is £650,000 in inner London and £500,000 in outer London. In Manchester it’s £335,000, with other areas still to be confirmed.
- Key dates: pre-registration opens by the end of December 2026. Full applications open from February 2027, and the first loans will be issued from April 2027.
Homes England will run the scheme at first, and the National Housing Bank will take over later. There’s a review point next autumn, and funding is capped each year.
It’s predicted to help up to 30,000 first-time buyers a year get onto the property ladder – that means it will support around 1 in 10 first home purchases.
First Time Buyer ISA to replace the Lifetime ISA
A new First Time Buyer ISA will replace the Lifetime ISA (LISA) for new savers from April 2029. If you already have a LISA, you can keep it.
Here’s how the new ISA will work:
- Saving: up to £4,000 a year. You must be 18 or over, and there’s no upper age limit.
- Bonus: 25%, up to a maximum of £20,000 based on your final balance at the point of house purchase.
- When you get it: the bonus is paid at exchange of contracts, with no withdrawal charge. You then have 90 days to complete on your home purchase.
- House price limit: £450,000.
- The rules: so far, we know that you must hold the account for at least 1 year and use it in conjunction with a mortgage. You can choose a cash or a stocks and shares account, but you can only have one First Time Buyer ISA at a time.
- Help to Buy ISA: you can move your full balance in on top of the annual limit, between 6 April 2029 and 1 December 2030.
- LISA: you can’t transfer a LISA into a First Time Buyer ISA, but you can use both towards the same home purchase.
There’s a change to the LISA too. From 29 October 2026, the withdrawal charge drops from 25% to 20% for purchases above £450,000. This means if you buy a home for more than £450,000, you’d get back what you paid into the LISA and only lose the government bonus. The charge for unauthorised withdrawals stays at 25%.
In other news, the annual cash ISA limit will remain as £20,000 – which is good news for all types of savers.
More homes: support for housebuilders and social housing
The Budget also includes measures to reduce costs for housebuilders and allocate funding to creating more social housing. There are also incentives to encourage the release of land for social housing.
These steps could help more homes get built and make them more affordable over time. But the impact of this will depend on how quickly the support is delivered, and whether it actually leads to more homes being built (something else we’ll keep an eye on).
The government have also pledged an extra £432 million for a programme aimed at giving everyone sleeping rough in England a route off the streets or other support by Christmas.
What it means for the market right now
Our latest House Price Index found that UK house prices rose 0.8% in the year to September. Sales agreed were down 7% year on year, but the number of homes for sale was up 7%.
If you’re buying, that means more choice. If you’re selling, a realistic asking price backed by data and finding an expert local agent to handle the process is more important than ever.
Uncertainty around a Budget can cause buyers and sellers to hesitate or hold off from making a move – now that these details have been released, people can resume planning their moves.
Rise to property income tax rates for landlords
John Healey announced a further 2% tax increase on rental property and savings incomes starting in April 2027.
This new measure targets individual landlords and savers, coming directly on top of the separate 2% property income tax hike introduced by the previous Chancellor a year ago.
The New Projected Tax Rates (From April 2027)
Because property and savings income will now be taxed under their own independent regime apart from normal employment income, this second consecutive 2% hike means the total tax rates for landlords are expected to reach:
- Basic-rate taxpayers: 24% (originally 20%, raised to 22% last year, and now up to 24%).
- Higher-rate taxpayers: 44% (originally 40%, raised to 42% last year, and now up to 44%).
- Additional-rate taxpayers: 49% (originally 45%, raised to 47% last year, and now up to 49%).
The move is likely to unsettle landlords further. It comes after Reeves raised stamp duty on the purchase of additional homes, from 3% to 5%, in last year’s Budget.
And there are further regulations for landlords to navigate, such as the Renters’ Rights Act and new energy efficiency regulations.
Landlords have faced higher costs for a number of years and this will be another reduction in post-tax income. However, rents continue to rise and are 25% up over the last 5 years which has supported the income for landlords in the face of rising costs.
Ultimately the property market sustains thousands of jobs, including tradespeople, removal companies and suppliers of white goods, and supports a thriving property market for years to come.
What are your thoughts on the Autumn budget 2026?
