New official data indicates a slight annual decline in UK residential property transactions during October, as the market adopted a cautious stance ahead of the government's Autumn Budget.
Key Figures and Market Context
According to figures released by HM Revenue and Customs (HMRC), an estimated 98,450 home sales were completed across the UK in October 2025. This represents a 2% decrease compared to the same month in 2024, though it marks a 2% increase from September 2025's activity.
The data, which reflects sales agreed upon months earlier, arrived just days after the Chancellor's Budget announcement. Property experts suggest the figures show a market in a holding pattern, awaiting clarity on future government policy.
Budget Unveils New High-Value Property Surcharge
The Wednesday Budget introduced a significant new measure for the English property market: a high-value council tax surcharge on homes valued above £2 million, effective from April 2028.
This additional levy will be structured across four price bands:
- A £2,500 annual surcharge for properties worth over £2 million.
- A rising scale, culminating in a £7,500 yearly charge for properties valued above £5 million.
The charge will be applied directly to property owners, not tenants, and will sit on top of standard council tax bills. The government estimates this will affect fewer than 1% of UK properties but is projected to raise over £400 million in the 2029-30 financial year.
Expert Analysis and Market Forecast
Nick Leeming, chairman of Jackson-Stops, described the transaction results as a "mixed-bag", noting a market largely "on pause" despite some deals being fast-tracked to pre-empt the Budget. He anticipates more stock will enter the market in the short-term, with potential price adjustments for properties just above the £2 million threshold.
"We might also see an increase in demand for homes under the tax limit," Leeming added, suggesting this could create upward price pressure in the mid-tier markets of the South East.
Jeremy Leaf, a north London estate agent, expressed optimism, stating, "As affordability gradually improves, especially with another base rate cut looking likely, we expect transaction numbers to pick up." He believes the impact of the so-called 'mansion tax' will be minimal, given its deferred implementation.
Sarah Coles, head of personal finance at Hargreaves Lansdown, pointed out that the October sales data predated the full Budget speculation. "The fact that the Budget didn't deliver a major blow for buyers should help support sales in the coming months," she said, acknowledging the new charge will affect the top end of the market with some trickle-down effect.
Iain McKenzie, CEO of the Guild of Property Professionals, highlighted that the market remains "underpinned by needs-based buyers and sellers" who continue to transact for lifestyle reasons.
With the Budget now providing clarity, other experts like Jason Tebb, president of OnTheMarket, believe buyers and sellers can now proceed with transactions "without worrying as to what may be round the corner."
