Budget tax rumours hit house sales and buyer demand: Zoopla – Mortgage Strategy

Budget speculation about property tax changes caused a big drop in agreed sales and buyer demand, according to Zoopla.

The estate agent’s latest house price index shows that there was a 12% drop in housing demand in the four weeks to 23 November when compared to the same period of 2024.House prices fell year on year in London and the South for the first time in 18 months.

Zoopla figures show that house prices dropped by 0.1% in London and the South East and by 0.2% in the South West.

However, property prices in more affordable regions continued to rise.

The average UK house price rose by 1.3% over the year, to £270,200.

Most regions had above-average house price growth, bar the South.

Rumoured Budget changes to stamp duty did not happen, but Zoopla said that the tax remains a major barrier to buyers.

Stamp duty thresholds for existing homeowners were set in 2014 and have not changed, but house prices are now 47% higher, leading to more buyers being pushed into higher tax bands.

Zoopla executive director Richard Donnell said: “The Budget bark was worse than the Budget bite for the housing market. Home buyers and sellers will welcome the end of the uncertainty that has stalled housing market activity since the late summer.

“Our data shows the underlying demand to move home remains strong. With greater certainty we expect a rebound in housing market activity that builds into the new year with households who paused home moving decisions over recent months return with greater confidence.

“The removal of the threat of a new annual property tax from 210,000 homes is particularly positive for the market and will help revive activity in higher-value areas across southern England where house prices are under pressure.”

Yesterday deVere Group said that the economic certainty following the Budget paves the way for UK interest rates to fall sooner and faster than markets currently expect.