Autumn Budget 2025 - Everything property investors need to know

Reeves has introduced several updates to CGT thresholds and relief structures aimed at encouraging longer-term property ownership and investment stability. The adjustments are designed to reward those who hold assets for extended periods, aligning with the government’s broader goal of promoting sustainable growth in the housing and investment markets.

For property investors, these changes could mean that a larger portion of profit is retained upon selling an asset, particularly for those who demonstrate a commitment to long-term holding rather than short-term resales.

A shift in focus to long-term investment rather than speculative flipping strategies could also support property prices and help create a more stable investment climate over time.

The Budget also introduces a new mansion tax on high-value residential properties. This equates to an annual charge of £2,500 for properties worth more than £2m and £7,500 for properties worth more than £5m. Reeves confirmed this will be levied on owners and collected alongside council tax.

With sustainability at the heart of government policy, the Budget confirmed a new wave of incentives for landlords undertaking energy-efficiency improvements. Measures include grants to support EPC upgrades and potential preferential lending for eco-friendly developments.

As a result, savvy investors could see reduced property running costs in the long-term, plus potential access to more attractive financing options.

Add that to the fact that environmentally friendly properties are increasingly in demand among renters, investors could also see a rise in property values over time as a result.

Tax Changes for Short-Term Rentals

Following ongoing consultations, the Budget confirms a new levy for overnight stays, giving city mayors discretion to implement charges similar to existing tourism taxes in European cities.

In fact, places like Liverpool have already adopted a £2-per-night visitor charge, setting the direction for others to follow.

Short-term rental taxation could not only have strong economic benefits for the cities themselves, but bring more confidence to investors, too. Having clearer rules on income from short-term lets could lead to greater long-term profitability for investors in this space, particularly in major city centres and areas with high tourism demand.

While the new government proposals could stir confusion and uncertainty among investors, there is clear potential for this Budget to have a positive impact on the property investment market.

From incentives for environmental upgrades to an increased focus on supply and affordability, a focus on stimulating growth within the sector should provide ample opportunities for both new and seasoned investors.

Regardless of changes, property remains a long-term investment strategy, and the government’s ongoing efforts to support the market through tax reforms, lending incentives, and infrastructural investments can only enhance its appeal as an investment option.

In the words of the Chancellor herself: “If you build here, Britain will back you.”

*Investors should conduct their own thorough research and due diligence, and seek independent financial advice before making any investment decisions.