The Autumn Statement and how it affects the property market
Chancellor Jeremy Hunt released his Autumn Statement on 17th November, and there are a number of policies that would be of interest to landlords, tenants, buyers and sellers. We’ve outlined the key points of interest from the Autumn Statement below.
Stamp duty cuts
The current Stamp Duty cuts, introduced at the last mini-Budget, will be reversed in March 2025. There could be a scramble to get a sale complete, similar to what we saw at the end of the last Stamp Duty cut during the pandemic.
Tax
The Higher Rate Income Tax threshold will be reduced in April 2023 from £150,000 to £125,140. Those with large property portfolios or with a high income will pay more tax.
The capital gains tax threshold will be cut from £12,300 to £6,000 for 2023/24. For 2024/25, it will be cut further to £3,000.
The yearly dividend threshold will be cut from £2,000 to £1,000 in 2023, and then again in 2024 to £500.
Councils will be able to increase council tax by 3%, plus an additional 2% for social care.
Energy price cap
From April 2023, the price cap will be increased to £3,000 per year, an increase of £500 from the current cap of £2,500. This affects everyone, especially tenants who are already paying record high rents and landlords who let their properties with all bills included.
Other key notes
The Office of Budget Responsibility (OBR) warns that house prices could fall by 9% over the next 2 years. High mortgage rates will affect buyers so demand is expected to cool.
The OBR also warns that property transactions will fall by 15pc year-on-year in 2013 - this equates to roughly 200,000 sales. The OBR also says that the UK, along with a third of the world’s countries, have entered into a recession
It also states that the current inflation rates are set to peak at 11.1% this quarter. This suggests interest rates may not increase much more which could potentially start lowering mortgage rates.
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