Autumn Budget 2026: what it means for buyers, sellers and landlords

By Nichola Andrews - Director of Property Management November 2026

The Autumn Budget introduces higher property income tax and new support for first-time buyers. Here are the key announcements and their implications for those buying, selling or letting in Kensington, Notting Hill and North Kensington.

The key property announcements

  • Higher tax on property income: from 6 April 2027, the basic, higher and additional rates will be 24%, 44% and 49%, following a further two percentage point increase on the rates announced last year.
  • Support for first-time buyers: the Your First Home scheme will offer eligible buyers a 20% government equity loan towards qualifying new-build purchases, with a minimum 2.5% deposit. Applications are expected to open in February 2027.
  • A reduced Lifetime ISA withdrawal charge: from 29 October 2026, the charge for otherwise qualifying first-home purchases above £450,000 falls from 25% to 20%.
  • A new First Time Buyer ISA: planned for April 2029, replacing the Lifetime ISA for new savers, with a £450,000 property price limit.

For landlords, the immediate consideration is how higher tax will affect net returns. For first-time buyers, the support available depends on their circumstances and the property they choose. Sellers will need to assess local demand and pricing as the market absorbs the announcements.

Landlords: review your net returns before April

If you own a rental property personally, it’s worth reviewing the new tax rates with your adviser before April. Properties held through a company have different tax considerations.

Look at what you keep after mortgage costs, repairs, management fees and any gaps between tenancies. Before deciding to sell or change how you own the property, make sure you understand the costs and tax consequences.

The better news is that rents have continued to rise. LonRes recorded annual growth in achieved rents of 4.0% across prime London in Q3 2026, including 5.8% in prime central London. These figures predate the Budget and cover the wider market, so they won’t tell you how an individual property is performing.

An up-to-date rental valuation is a useful starting point. Realistic pricing, timely repairs and organised tenant changeovers can also help reduce avoidable costs.

Don’t forget you can deduct letting and management fees from taxable rental profit

Letting and property management fees are generally deductible when calculating taxable rental profit.

Last year’s Budget announced a two percentage point increase in tax on property and savings income from April 2027, which would have taken the rates to:

  • 22% on taxable rental and savings income (instead of 20%) for basic rate taxpayers.
  • 42% on taxable rental and savings income (instead of 40%) for higher rate taxpayers.
  • 47% for additional-rate taxpayers (instead of 45%).

This year’s Budget adds a further two percentage points from the same date. From 6 April 2027, the rates on taxable rental and savings income will therefore be:

  • 24% on taxable rental and savings income (instead of 20%) for basic rate taxpayers.
  • 44% on taxable rental and savings income (instead of 40%) for higher rate taxpayers.
  • 49% on taxable rental and savings income (instead of 45%) for additional-rate taxpayers.

Letting and management fees are generally fully deductible, depending on your personal tax circumstances. From April 2027, an additional-rate taxpayer receiving full relief at 49% could therefore save 49% of the allowable fees through reduced tax, lowering the net cost of appointing a professional managing agent.

That makes a meaningful difference to the cost of professional property management. Alongside this are the other benefits, including time saved dealing with repairs, inspections, general tenant enquiries and the ever-growing compliance obligations.

If you’re considering moving away from self-management, Mountgrange Heritage’s highly experienced team is on hand to help. Talk to us about letting and property management. We also offer three months’ free management to new clients, subject to terms and conditions, so don’t forget to ask about that!

Buyers: check which support applies to your purchase

The Your First Home scheme is restricted to qualifying new-build homes. Existing period flats and houses are excluded, so it won’t cover many properties in our neighbourhoods.

The London household income cap is £140,000. Property price caps are £650,000 in inner London and £500,000 in outer London, with first purchases expected from April 2027.

The government equity loan is interest-free for five years, but it must be repaid. The amount repayable is linked to the property’s value, so it can rise or fall. Buyers should consider the longer-term costs alongside the smaller initial deposit.

For existing Lifetime ISA holders buying their first home above £450,000, the reduced withdrawal charge may help. The charge has fallen from 25% to 20%, rather than being removed, so check with your provider how much you’ll have available for your purchase.

The new First Time Buyer ISA is a longer-term measure, planned for April 2029. Existing Lifetime ISA holders will be able to continue using their accounts under the current rules.

Whatever your route to buying, allow for stamp duty, legal fees, a survey and any immediate work. For leasehold homes, check the remaining lease term, service charges and planned major works. Speak to a mortgage adviser early so you know what you can comfortably afford.

Sellers: keep your plans grounded in the local market

Will the new buyer support help sellers? It applies only to qualifying new-build homes, so it won’t directly support purchases of existing properties.

For those selling a period flat or house, recent comparable sales, competing listings and buyer feedback remain the most useful guides to pricing.

Rightmove’s October 2026 report shows that London asking prices rose by 2.5% over the month but remained 1.7% below a year earlier. Homes in the capital took an average of 78 days to find a buyer. These figures predate the Budget and cover London as a whole. They measure asking prices, rather than completed sale prices.

Before launching, ask your agent which repairs or presentation improvements are worth doing. Instructing a solicitor early and gathering leasehold information can help identify potential delays before a buyer is found.

If you’re already on the market, review viewing levels and feedback with your agent. This will help you decide whether the marketing or asking price needs adjusting.

If you’re weighing up your next move, speak to Mountgrange Heritage about a sales or rental valuation, property management or registering your search.

Nichola Andrews
Director of Property Management
nichola@mountgrangeheritage.co.uk

Information correct at 3rd November 2026. Scheme eligibility and tax treatment depend on individual circumstances. Seek independent financial, legal or tax advice where appropriate.

Sources: Rightmove’s October 2026 House Price Index, LonRes’s Autumn 2026 Prime London Market Update, the government’s Budget 2026 document and Your First Home scheme guidance.

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