The Autumn Budget 2025 arrived with high drama, an unprecedented early leak of the Office for Budget Responsibility’s (OBR) report before the Chancellor even stood up. The OBR quickly pulled the document and apologised for the “technical error,” but not before revealing sweeping tax changes and new forecasts. In a nutshell, millions will end up paying more tax (via stealthy freezes to allowances) while a major welfare cap (the two-child limit on benefits) is set to be liftedobr.ukresearchbriefings.files.parliament.uk. The government is using the extra revenue (about £26 billion a year by 2029–30) to build a fiscal buffer, roughly doubling its headroom on borrowing targets to ~£22 billionreuters.comobr.uk. We break down what these Budget measures mean for homeowners, property investors, and mortgage borrowers in the UK.

Income Tax Thresholds Frozen Until 2031

One of the most significant changes is the extension of the income tax threshold freeze by an additional three years. Tax-free personal allowances and higher-rate thresholds, which were already frozen in cash terms through April 2028, will now remain unchanged until April 2031 (the end of FY 2030/31). Freezing these thresholds boosts government revenue through “fiscal drag”: as inflation and wage growth push up incomes, more people are dragged into higher tax brackets or start paying tax when they previously didn’t. The OBR’s leaked report confirms this stealth tax increase will raise roughly £8.0 billion extra by 2029–30obr.uk. In fact, when combined with other measures, the overall tax burden is now on track to reach about 38% of GDP by 2030, a post-war record highreuters.com.

For households, this prolonged freeze means take-home pay will be tighter in real terms for years to come. As incomes gradually rise, many families will find a portion of their earnings taxed at 20% or even 40%, reducing disposable income. The OBR estimates the freeze will result in around 780,000 more basic-rate taxpayers and 920,000 more higher-rate taxpayers by 2029–30 than if thresholds rose with inflationobr.uk. Mortgage affordability could be squeezed, since lenders look at net income – and net incomes will grow more slowly due to the frozen allowances. Prospective homebuyers may need to temper their budgets, and existing homeowners might feel less financial flexibility for maintenance or upgrades as a larger share of pay goes to income tax. The policy is politically sensitive (the Chancellor had previously warned such a freeze would “hurt working people”), but it is now confirmed as a cornerstone of the Budget’s revenue-raising plans.

Council Tax Surcharge on £2 Million+ Homes (“Mansion Tax”)

After much speculation, the Budget confirms a new “mansion tax” on high-value properties – implemented as a high-value council tax surcharge rather than a separate levy. Starting from April 2028, homes in England valued above £2 million will face an annual surcharge on their council tax billsgov.uk. There will be four bands based on property value, with the charge ranging from £2,500 per year (for properties £2.0–2.5 million) up to £7,500 per year (for £5 million+ homes)reuters.com. These amounts will rise with inflation each year after

introductionreuters.com. Local councils will collect the surcharge on behalf of central government (which will compensate councils for the admin cost), and the revenue – roughly £0.4 billion annually – is slated to support local servicesgov.uk. Fewer than 1% of properties in England are expected to be above the £2 million thresholdgov.uk, which equates to perhaps 100,000 homes, largely in London and the South East.

For those homeowners affected, this is a significant new cost to factor into their finances and long-term plans. Industry figures have reacted sharply – critics argue it relies too much on property value as a proxy for ability to pay. Many households in £2 million+ homes are “asset rich but cash poor,” having seen their home values appreciate without a matching rise in incomelettingagenttoday.co.uk. Treating the property’s value alone as evidence of financial capacity could put pressure on owners whose wealth is tied up in the house. There are also concerns about implementation: the Valuation Office will need to carry out revaluations in 2026 to identify which homes exceed £2 million, and repeat this every five yearsgov.uk. Disputes and “cliff edge” issues may arise around the cut-off points (e.g. £2.0m vs £1.95m value), and analysts warn the cost of the valuation exercise could eat into the tax takelettingagenttoday.co.uk.

On the market impact, opinions are divided. Some estate agents believe this measure is “more political than anything” since it will raise relatively little money and its implementation is delayedlettingagenttoday.co.uk. The top surcharge of £7.5k on a £5m+ home equates to only ~0.15% of the property’s value annually, which is modest and perhaps already priced into that market. Importantly, the government will allow owners to defer the charges until the property is sold or upon death (details to be worked out in consultation)lettingagenttoday.co.uk. This deferral option means no one should be forced to sell their home in the short term just to pay the tax bill – a crucial relief that should prevent a sudden rush of high-end homes being dumped on the market in 2027. Indeed, now that the policy is confirmed (and less punitive than some earlier rumours), it might unfreeze some buying/selling decisions that were on hold. Buyers and sellers of £2m+ properties have more certainty and can make plans accordingly, albeit knowing an extra cost is cominglettingagenttoday.co.uk.

Over the longer term, the surcharge could gently incentivise certain owners to adjust their housing choices. Older homeowners in large valuable houses may feel a bit more push to downsize (to avoid accruing annual charges), and heavily mortgaged owners of high-value homes might consider moving to a less expensive propertylettingagenttoday.co.uk. In some cases this could free up larger family homes to the market. However, any impact is likely to be gradual. The ability to defer payment removes the immediate financial shock, and if political opposition to the tax grows, some owners may even gamble that a future government could amend or scrap itlettingagenttoday.co.uk. It’s also worth noting that because the £2 million threshold is fixed (in nominal terms), more properties will creep into the “mansion tax” net over time as house prices inflatelettingagenttoday.co.uk.

What qualifies as a “mansion” will expand to include more regular family homes in pricey areas – making the nickname somewhat misleading in the future. For now, if you own a property near or above the £2 million mark, keep an eye on this. You won’t feel the effect until 2028, and there may be planning opportunities (or relief schemes) as implementation details are worked out. But by that time, expect an added line on your council tax bill – one that, in high-value markets, could be several thousand pounds a year.

Higher Taxes on Landlords and Property Investors

Property investors will feel a pinch from multiple angles in this Budget. A headline measure is a 2 percentage-point increase in income tax rates on property rental income, dividends, and savings interest, taking effect from April 2027lettingagenttoday.co.uk. In practice, this means if you’re a landlord currently paying 40% tax on your rental profits, you’ll pay 42% from 2027; basic-rate taxpayers’ rental income will be taxed at 22% instead of 20%, and additional-rate landlords will go from 45% to 47%. (Dividend and savings tax rates will similarly rise by 2 points.) The government’s strategy is clearly to target “unearned” and investment income for extra revenue, rather than raising headline rates on employment income. According to the OBR, this move will raise about £2.1 billion a year by 2029–30 across those three income categoriesobr.uk. The portion attributable to property income tax is relatively small – roughly £0.5 billion per year on average from 2028–29 onwardlettingagenttoday.co.uk – but it adds to the cumulative squeeze on landlords.

For landlords, this tax hike effectively reduces net rental yields and could influence decisions about holding or expanding property portfolios. It comes on top of a raft of tax changes over the past decade that have already trimmed rental profits. Recall that in late 2024 the Stamp Duty Land Tax surcharge on second properties was increased from 3% to 5%zoopla.co.uk (meaning any additional home purchase incurs a 5% extra stamp duty on the entire price), and mortgage interest relief for individual landlords has since 2020 been limited to the basic 20% rate. Capital gains tax allowances have been cut, and new energy efficiency and compliance costs loom. All told, the tax burden on being a buy-to-let landlord or second-home owner is far higher now than it was even five years ago.

Not surprisingly, the industry’s response to the latest tax grab has been furious. “Yet another hammer blow to the private rented sector,” is how one lettings agency head described the 2% landlord levylettingagenttoday.co.uk. The National Residential Landlords Association (NRLA) slammed the policy, saying the OBR itself makes clear it will “drive up rents” as landlords seek to recoup some of the costlettingagenttoday.co.uk. The NRLA warns nearly one million new rental homes are needed by 2031, but this Budget is “clobbering tenants with higher costs while doing nothing to improve access to the homes people need”lettingagenttoday.co.uk. Likewise, property analysts at Rightmove noted that landlords might seem like an easy target politically, but taxing the rental sector ultimately tends to hurt tenants. If investor margins shrink, some will exit or pass costs on, and “in order to provide tenants with much-needed homes, landlord investors need to be able to make the sums add up”lettingagenttoday.co.uk. With mortgage rates for buy-to-let loans higher than a couple years ago and many regulatory changes in motion, this tax rise simply “makes it even harder for some landlords to make investments viable,” Rightmove’s expert saidlettingagenttoday.co.uk.

From a housing market perspective, higher taxes on landlords could have mixed effects. The OBR expects that raising property income tax rates will slightly slow house price growth – by around 0.1% lower growth per year from 2028 onward, all else equaltheintermediary.co.uk. The logic is that investor-buyers will factor in lower after-tax rental yields, so they may bid less aggressively on properties, softening prices a touch. In the long run, fewer amateur landlords in the market could ease competition for first-time buyers, potentially tilting the balance a bit toward owner-occupiers. However, if many landlords sell off properties or stop investing, the rental supply could tighten and push rents up further. It’s a delicate balance. We may see more landlords consider holding properties via company structures (where profits are subject to corporation tax at 25% but dividend extraction would then face the higher dividend tax) or other vehicles to mitigate personal tax rates. Others with slim margins or looming refurb costs might decide to trim their portfolios. For property investors, the message is clear: the Treasury is looking to you for revenue, so it’s time to recalculate your post-tax returns and strategy. Some marginal buy-to-let investments may no longer be worthwhile, and the emphasis should shift to maximizing efficiency – whether that’s through incorporation, refinancing at better rates, or investing in higher-yield areas to offset the tax drag.

Market Outlook: Interest Rates, House Prices, and Housing Supply

Beyond the specific tax and policy changes, the Budget also delivered an updated economic forecast that is directly relevant to the housing market. The OBR has trimmed the UK’s growth prospects, now projecting average annual GDP growth of about 1.5% over the next five years, which is 0.3 percentage points lower than forecast back in Marchreuters.com. This downgrade is largely due to a gloomier view on productivity growth (the OBR finally conceded that the post-2008 productivity slowdown is likely to persist)kpmg.com. Meanwhile, inflation is running higher than previously expected: the OBR now forecasts CPI at 3.5% for 2025 and 2.5% in 2026, reflecting sticky food and service pricesreuters.com. In fact, inflation is not expected to get back to the Bank of England’s 2% target until 2027 – a year later than hopedreuters.com. In short, the economy will grow modestly, and price pressures will ease only slowly, creating a challenging backdrop for household finances.

Crucially for homeowners, interest rates are expected to remain elevated in the near term. The OBR notes that the average interest rate on outstanding mortgages (the “mortgage stock” rate) is set to rise from roughly 3.7% in 2024 to about 5.0% by 2029theintermediary.co.uk. This doesn’t necessarily mean the Bank of England base rate will be 5% that whole time – rather, as homeowners gradually refinance out of older low-rate deals into newer higher-rate deals, the effective average mortgage rate in the economy climbs toward the new normal. (With around 90% of mortgages now on fixed rates, changes in Bank Rate hit borrowers only with a lagtheintermediary.co.uk.) The forecast implies that many borrowers coming off 2% or 3% fixes in the next few years will refinance at rates in the 5% range, driving up their monthly payments. If your mortgage is due to refinance in 2024–2026, it would be prudent to budget for higher payments than you’ve been used to – even if the Bank of England starts cutting rates in 2024 or 2025, as markets expect, it may not be enough to bring mortgage deals back down to ultra-low levels. The OBR does assume monetary policy will loosen later in the decade (indeed, they see the average mortgage rate peaking around 2027 and then stabilising)theintermediary.co.uk. But in their forecast, mortgage costs in 2028–29 are still significantly above pre-2022 levels, because we’re unlikely to revisit the era of 0.5% base rates and 1.5% mortgage deals. The takeaway: interest rates may have peaked, but they’ll plateau at a higher level. Homeowners should plan accordingly, and new buyers will find that lending affordability tests (which consider stress rates around 6-7%) remain a hurdle.

What about house prices? The OBR foresees relatively modest price growth ahead. After the noticeable dip in 2023–24 (nationwide prices fell around 5% from their 2022 peak), the OBR expects a return to growth but at subdued levels: house prices are forecast to rise just under 3% in 2025, then average about 2.5% annual growth from 2026 onwardtheintermediary.co.uk. In concrete terms, the average UK house price (which is roughly £260,000 in 2024) is projected to reach just under £305,000 by 2030theintermediary.co.uk.

That growth is roughly in line with earnings growth or slightly above inflation – a far cry from the double-digit yearly gains seen during the pandemic boom. Essentially, the OBR expects a stable, unspectacular housing market: prices growing moderately, not crashing, but not skyrocketing either. In this scenario, affordability gradually improves for buyers who have seen wages rise (since prices won’t outrun incomes by much), but that improvement is tempered by the higher interest costs on mortgages. By 2030, mortgage rates are expected to be down a bit from their mid-decade highs, yet the benefit of slower house price growth could be offset by those financing costs. For existing homeowners, modest price growth means slower accumulation of equity – your property values might only be keeping pace with general inflation. For prospective buyers, it means you shouldn’t count on a big price correction to make homes markedly cheaper, but you also don’t need to panic about prices running away from you as they did in 2020–2021. It’s a more balanced outlook, with regional variations likely persisting (areas with strong local economies or limited housing supply may outperform the averages, while others lag).

On housing supply, an important tidbit was buried in the OBR’s analysis: housebuilding is projected to slow in the mid-2020s before picking up later. Net additions to the housing stock (new builds minus demolitions, etc.) are running around 260,000 per year in the early 2020s, but due to recent weaker housing starts and tougher development economics, the annual figure is expected to drop to ~215,000 in 2026–27theintermediary.co.uk. This dip reflects the impact of higher construction costs, planning delays, and perhaps cautious builder sentiment when house prices dipped. However, the government’s planned planning reforms (though not detailed in the Budget, they have been hinted at in policy papers) are anticipated to then boost supply in the later 2020s. The OBR expects net new housing additions to rise sharply, reaching about 305,000 a year by 2029–30theintermediary.co.uk.

If achieved, that would be a significant uptick, potentially the highest level of housebuilding in decades (and would approach the government’s erstwhile target of 300k a year). Cumulatively, between 2024–25 and 2029–30, the OBR projects about 1.49 million new homes will be added – only slightly (around 10k) fewer than they projected beforetheintermediary.co.uk. For the market, a dip in construction in the mid-term could constrain supply and prevent any oversupply-driven price falls. But by 2030, if 300k+ new homes are being delivered annually, that could gradually ease housing pressure and improve affordability (especially if concentrated in high-demand areas). Of course, this relies on those planning reforms truly taking effect and local communities accepting more development, which remains to be seen.

Property transaction volumes have also been volatile and are expected to recover only slowly. The OBR noted a striking pattern in 2025: transactions spiked in Q1 2025 and then slumped in Q2theintermediary.co.uk. Why? Because a temporary stamp duty cut expired on 1 April 2025, prompting many buyers to rush their purchases to complete before the deadline (and avoid higher stamp duty). After the reset of stamp duty thresholds in April, the market experienced a hangover with lower activity in mid-2025. Going forward, the OBR forecasts transactions will bounce back from that dip and then gradually rise to around 1.3 million per year by 2029theintermediary.co.uk.

However, they downgraded this outlook – 1.3m a year is about 155,000 fewer transactions annually than the OBR expected in their previous (March) forecasttheintermediary.co.uk. The reasons are structural: with higher stamp duty now baked in (the nil-rate band dropped back down, and the 5% surcharge for extra properties remains), there’s a bit more friction in moving. Add to that higher mortgage rates, which make it more expensive to upsize or relocate, and an aging population that typically moves less frequently (older homeowners staying put longer in their houses).

All these factors imply a somewhat lower “churn” rate in housing. For the property industry – estate agents, mortgage brokers, conveyancers – fewer transactions can mean a tougher environment, as there are simply fewer deals to go around compared to the ultra-busy years like 2021. For buyers and sellers, a calmer market with fewer frenzied bidding wars might be a relief, but it also suggests less overall mobility. We may see a continuation of recent trends: people stay in their homes longer on average, and when they do move, it’s driven by life events (family changes, job relocations) more than by speculative or investment motivations.

Bottom line: The housing market outlook is one of cautious stability. There’s no indication of an imminent crash, nor any reason to expect another sustained boom – rather, a slow grind. Prices are creeping up, not sprinting; transaction volumes will recover, but not to past peaks; and mortgage costs, while likely past their peak, will remain a headwind. As a homeowner or investor, you should base decisions on your personal circumstances and long-term goals, not on hoping for rapid gains or fearing dramatic collapses. Remember that regional and local variations will persist – some areas will outperform the national average, others will underperform, depending on local supply-demand dynamics and economic conditions. In this environment, realistic expectations and a focus on fundamentals (quality of the property, rental yields, your own budget constraints) will serve you better than any attempt to time the market.

Final Thoughts – Navigating the Changes

This Budget was a big one. It raises significant revenues – about £26 billion more per year by 2029–30 – largely through stealthy freezes and targeted tax increasesobr.uk. In return, the government’s books look healthier: the OBR says the Chancellor now has £21–22 billion of fiscal headroom against her fiscal rules in 2029–30obr.uk, roughly double what it was before. In theory, that buffer improves economic stability and gives the UK more resilience against future shocks (and perhaps room for pre-election tax cuts down the line). For the property sector, the implications are mixed. On one hand, a commitment to fiscal stability and lower borrowing can be good for interest rate outlooks and overall economic confidence – factors that support the housing market. On the other hand, many individual households and investors will be paying more to the Exchequer, which could weigh on housing activity at the margins (less disposable income for home improvements or saving a deposit, higher costs for landlords, etc.). As ever, policy changes create winners and losers.

Affluent homeowners with £3 million houses and multiple buy-to-lets will undoubtedly contribute more in tax and might see their property plans constrained. Typical first-time buyers might find the playing field a tad more even – if fewer landlords are competing for starter homes and prices only rise modestly – but they’ll still need to clear the hurdles of high mortgage rates and incomes eroded by tax drag. Renters in low-income families should benefit from the removal of the two-child benefits limit, which could improve their ability to pay rent or move to suitable larger homes (though notably the Budget did not unfreeze Local Housing Allowance rates for housing benefitpropertymark.co.uk, a point of contention). And while it’s outside the property sphere, it’s worth noting electric vehicle owners will lose their road-tax advantage: by 2028 they’ll be paying per-mile road charges, ending the free ride on fuel duty.

If you’re a homeowner or property investor, now is a good time to take stock of your finances and plans. Ask yourself: Do I understand how these tax changes (both immediate and coming years) will affect my cash flow? For instance, if you own high-value property, have you budgeted for the 2028 surcharge (or considered downsizing or transferring ownership in advance)? If you’re a landlord, have you accounted for the higher income tax in 2027 – and is your portfolio still profitable under those rates? It might even be worth bringing certain plans forward: for example, some owners of £2M+ homes are considering selling before 2028 to avoid the new tax (though with deferral in place, that’s less urgent than it initially sounded). Meanwhile, if you’ve been mulling an exit from the buy-to-let market (or switching properties into a company structure), the clock is ticking before the tax hike bites. For those with mortgages, it’s prudent to review your rate exposure – many clients are looking into remortgaging early or locking in longer fixes, essentially bracing for that drift toward ~5% average mortgage rates that the OBR predictstheintermediary.co.uk. Even if interest rates might fall in a couple of years, the current deals available (especially on longer fixed terms) might offer peace of mind against future volatility. Having a clear plan can turn these looming changes from a source of anxiety into something you’re proactively managing.

At Willow Private Finance, we’re monitoring these developments closely. Our team specialises in helping homeowners and investors navigate complex financial landscapes. Whether it’s finding a mortgage that fits your budget in a higher-rate world, or advising on portfolio strategy under the new tax regime, we’re here to offer guidance. The rules may be changing, but with careful planning you can still achieve your property goals. Feel free to reach out if you want to discuss how the Budget changes might affect your situation or explore financing options tailored to the new environment.

Despite the noise around the leak, the core message of Autumn Budget 2025 is clear: we’re entering a period of adjustment. Higher taxes and steadier (not falling) interest rates are the trade-off for shoring up the economy’s resilience. By staying informed and being proactive, homeowners and investors can adapt to these changes rather than be caught off guard. Property remains a long-term game, and with the right strategy – and maybe a bit of professional help – you can weather this new chapter and even find opportunities in the midst of change.

Frequently Asked Questions

1. Will my mortgage payments go up because of this Budget? – Not directly, but quite possibly indirectly. The Budget itself doesn’t mandate higher interest rates, but the OBR’s forecast assumes that average mortgage rates will climb to around 5% by 2029 as borrowers gradually refinance into higher-rate dealstheintermediary.co.uk. In other words, even if the Bank of England isn’t prompted to hike rates further, many homeowners will feel like rates “go up” when their current mortgage deal expires. Also, the squeeze on after-tax income (from frozen allowances and higher taxes) can affect how lenders assess affordability. So while your current mortgage won’t suddenly change, when you go to remortgage or get a new loan, you may qualify for a bit less, and the rate offered could be higher than what you’re used to. It’s wise to plan for higher monthly payments and talk to a broker about your options – in some cases we’re helping clients secure rate holds or remortgage earlier to lock in deals before any further market changes.
2. What is the “mansion tax” and who will it affect? – It’s informally called a mansion tax, but it’s implemented as a High-Value Council Tax Surcharge on homes worth over £2 million (in England). Starting April 2028, owners of properties valued above £2M will pay an extra levy each year alongside their normal council tax. The surcharge has four bands: £2,500 per year for homes valued £2.0–2.5M; £3,500 for £2.5–3.5M; £5,000 for £3.5–5.0M; and £7,500 for £5M+reuters.com. These amounts will increase with inflation. Roughly 0.5%–1% of UK homes fall in this category, mostly in London and the Southeast. If you own (or plan to buy) a property above £2M, you’ll see a new recurring tax from 2028. However, there will be provisions to help those who are “asset rich, cash poor” – for example, the government has said you can defer the charge until you sell the home or until your estate is settledlettingagenttoday.co.uk. So, it primarily affects wealthy homeowners on paper, though over time more homes could cross the £2M threshold. Keep in mind this is separate from (and in addition to) any inheritance tax or capital gains tax considerations on high-value property.
3. How does the income tax threshold freeze affect homeowners? – The freeze in personal tax thresholds (now extended to 2031) is a classic stealth tax. As your salary or pension income rises with inflation or career progression, more of it gets taxed – even though the tax bands don’t change. For homeowners, this means your take-home pay might grow more slowly than your gross pay. That reduction in disposable income can impact your ability to save for a deposit, afford monthly mortgage payments, or handle upkeep costs on your home. Lenders also consider your net income when deciding how much you can borrow. If inflation pushes you into a higher tax bracket, your net pay doesn’t go as far, potentially reducing the mortgage amount you’d qualify for. Over years, the effect is significant: by 2030, millions more people will be paying tax (or paying at 40%) than would have if thresholds kept up with inflationobr.uk. In short, the threshold freeze squeezes household budgets, which might mean making more modest home-buying plans or slowing down renovations until you’ve accounted for the extra tax drag.
4. Are buy-to-let landlords worse off after this Budget? – Yes, unquestionably. From April 2027, landlords will pay 2% more tax on their rental profits (22% basic rate, 42% higher rate, 47% top rate)lettingagenttoday.co.uk. This comes after years of tax changes that have already eaten into landlords’ income (higher stamp duty, loss of full mortgage interest relief, reduced capital gains allowances, etc.). The consensus is that this will make letting less profitable and will particularly hurt landlords with mortgages (who are also facing higher interest costs). Some landlords will try to pass on some of the cost by raising rents – and the OBR did mention there could be a slight upward pressure on rents as a resultlettingagenttoday.co.uk. Industry bodies like the NRLA are warning that it will drive landlords out of the market and reduce rental supply, which, ironically, could push rents up for tenantslettingagenttoday.co.uk. We’re already seeing some landlords re-evaluate their portfolios; those with tight margins might sell properties, and others are exploring moving their holdings into company structures. If you’re a landlord, you’ll need to factor in the higher tax when calculating your yields. It may be a good moment to review whether to hold or sell, and if holding, to ensure you have the most cost-efficient financing and ownership structure going forward.
5. Will lifting the two-child benefit cap affect housing demand? – Potentially, at the margins. The Budget removes the two-child limit on Universal Credit (effective April 2026)researchbriefings.files.parliament.uk, which means larger low-income families will receive more in benefits if they have a third or fourth child. In terms of housing, this could modestly increase demand for larger homes in the rental sector, especially in social housing or affordable rentals. Families that previously couldn’t afford a three-bedroom might now have a bit more income to put towards rent, seeking more space for their kids. It’s estimated this change will lift nearly half a million children out of poverty by 2030researchbriefings.files.parliament.uk, so it’s a significant boost to those households’ finances. Some of that extra money will go toward better housing conditions (either moving to a suitable home or catching up on rent arrears). However, it’s not a huge windfall per family – roughly £3,000 per year per additional child – so we’re not expecting a dramatic surge in housing market activity. It’s also worth noting that housing benefit (Local Housing Allowance) remains frozenpropertymark.co.uk, so in high-rent areas, benefits still might not cover the full rent. Overall, lifting the cap should improve housing stability for larger families on benefits (less overcrowding, fewer shortfalls), which is a positive social outcome, but it’s not likely to move national house price indices.
6. I drive an EV. What does the new mileage charge mean for me? – The Budget introduced a plan to charge electric and plug-in hybrid vehicles per mile, from April 2028. Essentially, this is the beginning of EVs being subject to “road pricing” similar to fuel duty. The announced rates are about £0.03 per mile for full EVs and £0.015 per mile for plug-in hybrids, with the rates indexed to inflation each yeartheguardian.comfinance.yahoo.com. For context, £0.03/mile is roughly half the per-mile fuel duty cost that petrol drivers pay (hence it’s positioned as a fair contribution to road upkeep). For an average EV driver doing 10,000 miles a year, that would be £300 annually in charges. It will be collected likely via some tracking method (to be determined, possibly your MOT or a telematics system). The key point is that the era of EVs being exempt from fuel duty is ending. By 2028, if you have an electric car, you’ll need to budget for a new running cost – it’s still cheaper per mile than petrol in terms of tax, but it’s not zero. This is on top of the fact that EVs will also start paying Vehicle Excise Duty (road tax) from 2025 (that was announced previously). So, if you’ve been enjoying very low running costs on your EV, plan for that to creep up. It’s a reminder that incentives can shift over time – though EVs will likely remain cheaper to run than petrol/diesel for the foreseeable future, the gap will narrow a bit.
7. Is it a good time to remortgage or buy property? – It depends on your situation, but there are a few considerations post-Budget. On the remortgage side, if you’re currently on a deal that’s expiring within the next 6–12 months, it could be wise to start looking at options now. Mortgage rates have come off their 2023 highs slightly, but the OBR’s outlook suggests they won’t fall dramatically for some timetheintermediary.co.uk. Locking in a decent rate now could protect you from potential increases (or just give certainty in your budgeting). Many lenders offer the ability to secure a rate up to 6 months in advance. Also, with tax thresholds frozen, your net income may not keep up with inflation – which means the sooner you lock in a mortgage (where affordability is calculated on today’s income), the better, before that erosion happens. On the buying side, there are pros and cons in the current climate. On the plus side, house price growth is slow and there are fewer buy-to-let investors competing, thanks to all the tax changes – this could give first-time buyers or home movers a bit more breathing room and negotiating power. Sellers know the market is not red-hot, so they may be more open to offers. On the downside, mortgage rates are relatively high and your borrowing capacity might be lower than a couple years ago. If you have a stable job and plan to stay in the home long-term, buying sooner rather than later can make sense, because you’ll start paying down your mortgage and you’ve got the benefit of softer prices now versus potential upticks later. But if your situation is uncertain or you’re stretching your budget, you might wait and see if interest rates ease. It really comes down to personal circumstances – we recommend talking to a broker who can run the numbers for rent vs buy in your case, or the savings of remortgaging now versus later. Often, we find there’s an advantage to acting sooner, but it must align with your life plans and financial comfort.

Sources: The analysis above is based on official data from the Office for Budget Responsibility and extensive news coverage of the Autumn Budget 2025, including reports from Reuters, BBC, industry publications (e.g. Letting Agent Today, Propertymark), and the UK Government’s own Budget documents. Key details – such as the tax rates, forecasts, and expected impacts – have been confirmed by the OBR’s Economic and Fiscal Outlookobr.uktheintermediary.co.uk and reputable news outlets as cited throughout the text. By staying informed via these reliable sources, we ensure that our insights and advice reflect the latest facts and figures from the Budget.

Wondering how these Budget changes affect your plans? – Let’s talk. Feel free to fill out our contact form and one of Willow’s specialists will be in touch to help you navigate your next steps in this new landscape. Whether it’s refinancing your mortgage, strategising your property investments, or simply budgeting for the years ahead, we’re here to help you make sense of it all.