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Published: 19 August 2025

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Widespread concern is building around reports that Labour is considering a major overhaul of the housing tax system, including the introduction of a new levy on higher-value homes.

According to The Guardian, Whitehall officials are exploring plans for a national property tax that could replace stamp duty on owner-occupied homes. One proposal under discussion includes imposing a new tax on properties valued over £500,000, raising fears of a broader shift in how property is taxed across the country.

The potential reforms are seen as part of a wider effort to modernise the current system, which many argue is outdated and inefficient. However, industry voices warn that any move perceived as targeting homeowners – particularly in areas with high property values – could be politically and economically risky.

Paula Higgins, founder and CEO of the HomeOwners Alliance, said: “Stamp duty is unfair, outdated and stalls the housing market. Our research shows that nearly half of homeowners considering a move say Stamp Duty puts them off, and it particularly penalises growing families and downsizers. Tinkering won’t fix it. The only solution is to scrap stamp duty completely.

“On the suggestion of introducing a new property tax there shouldn’t be a money grab by treasury at the expense of homeowners. It’s an attack on homeowners and history shows that introducing a new tax is never followed by the removal of older taxes.

“In the interim the government needs to tread carefully. Uncertainty around property taxes causes paralysis in the housing market. We’ve just seen how damaging this uncertainty can be: in April this year, when Stamp Duty thresholds changed, transactions collapsed by 64% in a single month – the sharpest fall on record. Homeowners can’t afford a repeat.”

In short, he welcomes the end of stamp duty but is concerned that the new taxes could be onerous and may lead to asking prices soaring on properties above £500,000 sellers offset losses. He is particularly concerned what the move might mean for those starting a family in London, where property prices are significantly higher than the average.

Gerrard said: “The existing stamp duty regime is unfit for purpose and has had a chilling effect on the housing market, which is why I’ve long campaigned to reform it. It’s good to see that the Government has understood some of the issues and is taking action to end the broken system. Adding further costs to purchasing a home has only reduced transactions, stifled upward mobility and prevented the efficient functioning of the housing market. This new tax would be paid by the seller, rather than the buyer which means that it won’t be the same tax on aspiration that Stamp Duty currently is.

“However, it’s clear that the government is motivated by a desire to raise revenues and I’m concerned that this new tax is going to be punishingly high. If that’s the case, you’re going to see a ceiling at the £500K threshold for that band of the market, as people avoid falling under the regime, and then a significant jump in values with nothing in between. Prices above £500K will skyrocket as sellers account for the losses caused by the tax, that used to be paid by the buyer.

“What most worries me is the effect on families in London. The housing market is far higher in London, which means any family home will be impacted by this new tax. If prices surge higher because of this new regime, how will anyone in the capital start a family? The government needs to think very carefully what the wider repercussions these changes might have and act carefully. So far many of its attempts at raising revenues through tax, such as the Stamp Duty changes earlier this year, have backfired.”

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Published: 06 August 2025

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There’s widespread expectation that the Bank of England’s monetary policy committee will cut base rate again this Thursday.

Analysts are almost unanimous in forecasting a quarter of a per cent cut – and many lenders are already factoring this into their deals.

Governor Andrew Bailey has made it clear that slightly higher inflation needs to be balanced against threats to growth.

GDP fell in both May and June, and with a backdrop of heightened global uncertainty and trade wars, there are some powerful headwinds. In this environment, it is considered essential by some analysts that higher rates don’t risk making things worse. Meanwhile, the weakening jobs market, and the slowing of pay rises, mean less risk of higher wages feeding further inflation.

Sarah Coles, head of personal finance at business consultancy Hargreaves Lansdown, says: “Fixed mortgage deals have been drifting gradually down for some time, with the 

average two-year fixed rate falling from 5.2% three months ago to 5.03% according to Moneyfacts. 

“They had bumped up slightly in the recent past, so in the last couple of days some banks have been cutting them in anticipation of a Bank of England rate cut. Assuming the rate is cut … we could see some competitive deals emerge after the announcement. However, further out, we may see cuts slow in the coming weeks. 

“This is partly because expectations haven’t changed as much recently and are increasingly priced in. It’s also because lenders don’t want to go too far or too fast, or people who have already agreed a rate in advance will abandon it in favour of a cheaper one.”

And for the first time since September 2022, the average two-year and five-year fixed mortgage rates are now identical at 4.52%, according to Rightmove’s mortgage tracker.

The portal says the narrowing gap reflects growing market confidence that interest rates will fall, with the Bank of England widely expected to cut the base rate.

Matt Smith, Rightmove’s mortgage commentator, says: “Over the last week, average mortgage rates have remained pretty flat in the build up to next week’s interest rate decision. 

Expectations are currently set on a cut … and I expect lenders will use this moment as an opportunity to reduce mortgage rates a little further.

“Rate drops have been very slow and steady this year, but someone looking to take out a mortgage right now is likely to see a notable reduction in the rate they’d have been offered this time last year, particularly someone looking to fix for two years.

“With average two-year and average five-year fixed currently level, it would appear to onl be a matter of time before the typical two-year rate is cheaper than the five-year equivalent.”

Mark Harris, chief executive at SPF Private Clients, add: “[Housing] Transaction numbers have risen again as base rate reductions encourage activity and enable borrowers to plan ahead with more confidence. Lenders continue to trim their mortgage rates, while easing of criteria should also enable borrowers to take on bigger mortgages in coming months.”

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Published: 15 July 2025

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Expectations of a base rate cut have increased following poorer-than-expected GDP figures were released over the weekend.

The economy contracted by 0.1%, the Office for National Statistics says, after also shrinking in April. Construction, manufacturing and in particular retail sales were described by the office as “very weak”. For the April to June period, the UK economy is now forecast to show combined growth of 0.1% to 0.2%.

The data now adds to expectations the Bank of England will cut interest rates next month.

“The lack of momentum in the UK economy indicated by these sluggish figures means that an August interest rate cut currently looks inevitable, despite the recent spike in inflation” says Suren Thiru, economics director at accountancy body ICAEW.

Lindsay James, investment strategist at Quilter, comments that recent U-turns on welfare cuts by  Chancellor Rachel Reeves means a “spotlight has been well and truly shone on the UK economy in the past week or so”.

Reeves herself says: “Getting more money in people’s pockets is my number one mission. While today’s figures are disappointing, I am determined to kickstart economic growth and deliver on that promise.

“The choices we have made in our first year in government have seen us extend the £3 bus fare cap, fund Free School Meals for over half a million more children, press ahead with plans to deliver free breakfast clubs for every child in the country and increase the National Minimum and National Living Wage, giving a pay rise to 3m workers.

“There’s more to do, that’s why in the Spending Review we boosted investment and jobs, through better city region transport and record funding for affordable homes, as well as backing major projects like Sizewell C.”

The Bank of England’s next rate decision will be on August 7

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Published: 03 July 2025

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"When the Bill becomes law, the notice period for common grounds such as sale or landlord occupation will increase to four months. Landlords will also face a new restriction: these grounds cannot be used within the first twelve months of a tenancy. This means a tenant is effectively protected from eviction for the first year, unless there is a serious breach of contract."
- Allison Thompson - LRG

As the Renters’ Rights Bill continues its progress through the House of Lords, landlords should be preparing for a much tighter framework around possession. One of the most significant changes proposed is the reform of Section 8, the legal route for regaining possession where a specific reason applies.

Section 21 is being abolished. In its place, Section 8 will become the standard mechanism for eviction, with new rules that introduce longer notice periods, stricter evidential requirements, and mandatory court involvement in most cases.

Understanding Section 8

Section 8 allows landlords to seek possession on either mandatory or discretionary grounds. Mandatory grounds include cases where the landlord intends to sell, move in, or where the tenant is in serious rent arrears. Discretionary grounds include antisocial behaviour, property damage, or other breaches of the tenancy agreement.

The proposed legislation does not remove these grounds but significantly changes the timelines and conditions around how and when they can be used.

Key changes landlords should prepare for

When the Bill becomes law, the notice period for common grounds such as sale or landlord occupation will increase to four months. Landlords will also face a new restriction: these grounds cannot be used within the first twelve months of a tenancy. This means a tenant is effectively protected from eviction for the first year, unless there is a serious breach of contract.

Landlords who seek possession in order to sell will also be subject to a further condition. Once notice is served and the four-month period has passed, the landlord will not be able to re-let the property for twelve months. During that time, the property cannot be marketed for rent or used as a holiday let or under a licence. The total restriction period is sixteen months from the point notice is given.

For rent arrears, the threshold will increase. Tenants must be at least three months in arrears before a Section 8 notice can be served. The notice period itself will increase from two to four weeks. In practice, this means landlords are likely to lose at least four months of rental income before they are able to begin the possession process.

The only exception to these longer timeframes is in cases of antisocial behaviour. Where this can be evidenced, landlords will be able to begin proceedings immediately.

What this means for landlords

The removal of Section 21 and the reforms to Section 8 represent a shift towards a more regulated and court-led approach. Every eviction will now need to be justified with clear evidence. In contested cases, a hearing will be required, which means higher legal costs and longer delays.

Landlords relying on sale as a reason to end a tenancy will need to plan carefully. If their circumstances change or the property does not sell, it may still have to sit vacant until the full restriction period has passed.

Longer notice periods will also increase financial exposure. In most cases, landlords will need to wait several months before regaining possession, potentially without rental income and with additional court costs.

At LRG, we are supporting landlords to review their property plans and tenancy management strategies. Early preparation is essential to avoid disputes and ensure compliance when the new law comes into force.

What this means for tenants

Tenants will benefit from more time and stronger legal protections. In most cases, they will have at least four months to respond if a landlord seeks possession. This gives them a better opportunity to resolve issues, make up arrears, or find a new home.

The proposed reforms also introduce clearer safeguards against unfair evictions. Landlords will need to prove their case, and tenants will have the right to challenge claims in court. At the same time, those involved in antisocial behaviour may face faster legal consequences, as landlords will no longer need to wait before taking action.

How landlords can prepare

Although the Renters’ Rights Bill is still being debated, it is sensible to prepare now. We recommend landlords:

·         Carry out stronger affordability checks before offering a tenancy

·         Keep accurate written records of communication and property condition

·         Review the Section 8 grounds and understand the new timelines

·         Check whether rent protection insurance includes cover for legal expenses

·         Work with an experienced managing agent to stay up to date and compliant

Good record keeping and proactive management will go a long way in reducing risk once the new system is in place.