Autumn Budget 2024 - How home buyers, sellers and owners are affected
The new Labour government’s Autumn Budget 2024 brings a range of measures with direct implications for home buyers, sellers, and property owners across the UK.
The Chancellor’s budget includes changes to stamp duty, first-time buyer relief, inheritance tax and plans to build more affordable housing.
In this article, we break down the key updates and explore what the changes mean for anyone navigating the property market, whether you're looking to buy, sell, or manage an existing property investment.
Key takeaways for home buyers and home owners
Although the budget contains no truly seismic changes affecting the property market, some prospective buyers and owners will have to revise their plans.
If you were planning to invest in a second home or buy-to-let property, the increase in SDLT may prompt you to reconsider your investment.
If you are saving to buy your first home soon, be aware that First-Time Buyer relief has not been extended past April 2025. Prospective homeowners will need to act fast to purchase their first property before the relief expires.
Stamp Duty changes
The most significant change for UK property in the Autumn Budget is the increase in Stamp Duty Land Tax (SDLT) on second homes and buy-to-let properties.
The SDLT surcharge rate has increased from 3% to 5% effective immediately (31st October 2024).
Introduced in April 2016, the SDLT surcharge aims to discourage second home ownership and buy-to-let investment, freeing up more properties for use as primary residences. The change will not affect existing second home owners and investors, but will apply to transfers of equity on additional property.
Read more:
Stamp Duty Land Tax calculator
First-Time Buyer relief reduced in April 2025
The Chancellor confirmed that Stamp Duty relief available to first-time buyers will reduce in April 2025, as planned.
In 2022, the threshold for paying 0% SDLT was temporarily raised from £300,000 to £425,000. First-time buyers currently pay no Stamp Duty on property up to £425k, but after April 2025 only the first £300k of the property’s value will be exempt.
First-time buyers should be aware that to qualify for the higher rate of relief, their property purchase must complete before the April 2025 deadline. Given that the conveyancing process can take time, first-time buyers should act fast to avoid missing out.
For example, a £500k property purchased in March 2025 would owe SDLT of £3,750. If your purchase completed after the April deadline, you would owe £10,000 in SDLT.
No new meaningful support to assist first-time buyers was announced.
Impact on Buy-to-let investors
Although Capital Gains Tax (CGT) has increased for employers, business owners and shareholders, CGT has not increased on the sale of second property. The rates remain fixed at 18% and 24% depending on your tax status.
The unchanged rate is good news for existing buy-to-let investors and second home owners, but property commentators have pointed out that increased regulation and unfavourable tax changes in recent years has already prompted many landlords to sell up.
Read more:
The buy-to-let conveyancing process
Affordable housing and Right to Buy
The budget included an additional £500 million to build affordable homes, increasing the overall affordable housing budget from £2.6 billion to £3.1 billion.
The Government’s target to build 1.5 million homes in the next four years includes these properties, but the details of the long-term strategy will not be known until the detailed plan is released next year.
The Government announced plans to reduce Right to Buy discounts and increase the length of time residents must have lived in social housing to qualify for Right to Buy. The Right to Buy scheme will also not apply to newly-built council houses.
Although the Right to Buy scheme has been an effective homeownership route for lower-income households, around 40% of Right to Buy properties are now owned by private landlords, who are able to rent them out at higher rates.
Read more:
The Right to Buy conveyancing process
Green Homes
The budget did not include new grants or support for more energy efficient homes. The Labour Government has faced pressure to widen eligibility for the Winter Fuel Payments this winter, after the scheme was initially planned to limit access, but no changes were made.
Capital Gains Tax on the sale of second homes
Capital Gains Tax (CGT) increased for business owners and shareholders, but CGT has not increased on the sale of additional properties.
No CGT is charged on the sale of main residences, but the tax rate for the sale of second and buy-to-let properties remains 18% for lower tax rate payers and 24%, for higher rate tax payers.
The impact of Inheritance Tax on pensions
Another major change announced in the Autumn is that inheritance tax (IHT) will be charged on pensions. Although this change doesn’t directly affect the sale and purchase of property, homeowners should consider the impact of the changes and plan accordingly.
If you plan to leave your main home to your descendants when both you and your spouse die, the maximum combined property allowance is £1 million. IHT on the transfer of property is only payable above the applicable threshold.
If you have questions or concerns about your pension and tax planning, you should speak to a tax account or financial adviser.
Should you change your plans to buy or sell a property?
By raising SDLT, the Chancellor has made it immediately more expensive to buy a second property. Prospective landlords and property investors may need to revise their plans and update their budgets accordingly.
First-time buyers will need to act fast, but if you already have a transaction underway, or are close to making an offer, you will likely avoid the higher rate. To ensure you beat the April 2025 deadline, you’ll need to ensure you instruct a conveyancing solicitor promptly, sign and return documents and forms as quickly as you can, and generally stay focused on moving the conveyancing process forwards.
First-time buyers who are planning to purchase closer to the deadline should be pragmatic and make room in their budget for the additional SDLT if completion of the sale is delayed.
If you are selling, you should also consider the impact of these changes, both on your buyer and on the market generally. If any first-time buyers are involved in a chain including your transaction, they may be affected by the lower SDLT thresholds when they come into effect in April. In addition, lower SDLT thresholds may affect property prices or dampen the market, but negative effects could be offset by the impact of lower interest rates.
