UK Budget 2026: What it means for estate agency owners

Chancellor John Healey's first Budget, delivered on Wednesday 28 October 2026, backs first time buyers and raises tax for landlords. For estate agents, a £4.7 billion Your First Home equity loan scheme opens new build demand from early 2027. Higher tax on rental income from April 2027 may lead some landlords to sell. Main stamp duty and capital gains tax rates are unchanged, while wage and mileage rates rise.

What are the main Budget 2026 changes for estate agents?

A new £4.7 billion Your First Home scheme for first time buyers

Your First Home is a new government scheme to help first time buyers in England purchase a new build home. The government expects it to help around 70,000 households and support around 20,000 new homes.

Under the scheme, the government lends the buyer 20% of the purchase price as an equity loan, while the buyer puts down a deposit of at least 2.5%and takes out a mortgage for the rest.

The equity loan is not a grant and must be repaid. It is interest free for the first five years, after which interest is charged and gradually increases.

Buyers repay 20% of the home’s value at the time they repay, not the original amount borrowed. For example, if a £300,000 home is worth £350,000 when the loan is repaid, the buyer repays £70,000 rather than £60,000. If the home falls in value, the amount owed falls too.

To qualify, household income must be no more than £110,000 outside London or £140,000 in London, and property price caps apply by local authority area, with separate caps for inner and outer London.

When can first time buyers apply?

Preregistration for Your First Home opens by the end of December 2026. Full applications open from February 2027, and the first loans will be issued from April 2027. Funding is capped each year.

Why does Your First Home matter for estate agents?

The scheme only covers new build homes from developers who sign up and pay a fee to take part. Agents who sell new build homes for participating developers are most likely to see buyers using it. Agents who mainly sell existing homes will see little direct effect.

A new First Time Buyer ISA will replace the Lifetime ISA

Budget 2026 makes two changes for first time buyers saving through an ISA. A cut to the Lifetime ISA withdrawal charge applies now. A new First Time Buyer ISA replaces the Lifetime ISA for new savers from April 2029.

What has changed for Lifetime ISA holders now?

From 29 October 2026, Lifetime ISA holders buying a first home above £450,000 pay a reduced withdrawal charge of 20%, down from 25%. The charge for other unauthorised withdrawals stays at 25%.

Existing Lifetime ISA holders can keep paying in and using their accounts under the current rules, including after April 2029.

How will the new First Time Buyer ISA work from April 2029?

From April 2029, new savers will open a First Time Buyer ISA instead of a Lifetime ISA. Savers can pay in up to £4,000 a year.

When they withdraw the money to buya first home worth up to £450,000, the government adds a 25% bonus on the account balance, up to a maximum of £20,000. For example, a saver with £20,000 in their account when they buywould receive a £5,000 bonus. There is no upper age limit.

Why do the ISA changes matter for estate agents?

The withdrawal charge cut matters now. First time buyers in higher priced areas, such as London and the South East, can use their Lifetime ISA savings on homes above £450,000 with a smaller penalty.

The new First Time Buyer ISA is a longer-term change. It won’t affect buyers until 2029, but removing the upper age limit means more people may be able to save towards a first home.

Landlords will pay more tax on rental income from April 2027

From 6 April 2027, the start of the 2027/28 tax year, landlords who own property in their own name will pay a higher rate of income tax on their rental profit than on their other income.

Budget 2025 announced a rise of 2 percentage points from that date. Budget 2026 adds a further 2 percentage points on top, so property income rates will be 4 percentage points above the main income tax rates from April 202

How much more tax will landlords pay?

A basic rate landlord with £10,000 of taxable rental profit will pay £2,400 instead of £2,000, an increase of £400. A higher rate landlord with the same profit will pay £4,400 instead of £4,000, also an increase of £400.

These rates apply in England, Wales and Northern Ireland. The Scottish and Welsh governments have the power to set their own property income rates, so landlords in Scotland and Wales should check what applies to them. Landlords who own property through a limited company are not affected, because companies pay corporation tax. HM Treasury estimates that 84% of income taxpayers will be unaffected by the changes to savings and property income tax rates.

Why does the landlord tax rise matter for estate agents?

Lower returns may lead some landlords to review their portfolios, and those who decide to sell will need valuations and an agent. On the buying side, buy-to-let investors buying in their own name will face lower returns from April 2027, which may affect investor demand for some property types.

Some landlords may ask about moving property into a limited company. Transferring an existing property can trigger capital gains tax and stamp duty, so agents should point them to a qualified tax adviser rather than recommendinga route.

Stamp duty rates are unchanged

The Budget made no change to the main stamp duty land tax (SDLT) rates for home buyers in England and Northern Ireland. Scotland and Wales have their own property taxes.

There is one change for lettings. SDLT on rent paid under assured tenancies in England has been removed, backdated to 1 May 2026, following the Renters’ Rights Act 2025.

Why does unchanged stamp duty matter for estate agents?

Moving costs stay where they were. Stamp duty remains one of the biggest upfront costs of moving, which can keep some homeowners from moving and slow the flow of stock onto the market. With no change in this Budget, buyers and sellers can plan their moves knowing what stamp duty will cost.

Capital gains tax on residential property is unchanged

The Budget made no change to the headline capital gains tax rates on residential property.

Gains on residential property are generally taxed at 18% or 24%, depending on the seller's income. Homeowners selling their main home may qualify for Private Residence Relief.

Why does unchanged capital gains tax matter for estate agents?

Landlords weighing a sale after the income tax rise face no new tax cost on selling. That makes their planning clearer, and any landlord who decides to sell is a potential instruction.

Homes worth £2 million or more face a council tax surcharge from April 2028

The High Value Council Tax Surcharge, first announced at Budget 2025, will apply to homes in England worth £2 million or more from April 2028. It’s an extra annual charge on top of normal council tax, based on what a home is worth at 2026 prices.

The £2 million threshold has not been lowered. Budget 2026 confirms:

• A deferral scheme for owners without the funds to pay.
• Discounts and exemptions for some property types.
• A 100% premium on homes left empty and unoccupied for 12 months or more.

Why does the surcharge matter for estate agents?

Because the surcharge is based on 2026 values, sale prices and valuations close to £2 million this year are likely to attract more questions from sellers and buyers. Prime owners will want accurate local pricing advice before the surcharge starts in 2028.

Agency wage and mileage rates rise

From April 2027, minimum wage rates rise by 3.9%. The temporary 55p tax-free mileage rate becomes permanent and the rate above 10,000 miles rises from 25p to 35p.

How much will wages and mileage rates change?

The Treasury estimates that someone driving 6,000 business miles a year saves around £120 in tax. The temporary 5p fuel duty cut is extended to 1 July 2027when fuel duty is due to rise with RPI inflation.

Why do wage and mileage changes matter for agency owners?

Payroll costs rise from April 2027 for staff paid at or near minimum wage, including junior staff and apprentices.

The higher mileage rates mean agencies can pay negotiators and valuers more per mile tax-free when they use their own cars for viewings and valuations. Agencies aren’t required to pay the full rate. Where an agency pays less, staff can claim tax relief on the difference.

Non-compete clauses in employment contracts will be reformed

The government will legislate so that non-compete clauses no longer stop workers moving jobs, across the whole economy. We recommend reviewing your employment contracts once further detail is published in early 2027.

When will the non-compete changes happen?

The government will consult on wider restrictive practices and publish its detailed position in early 2027, before legislating.

Why do non-compete changes matter for agency owners?

Many agencies use restrictive covenants to protect client relationships when negotiators leave. Review your employment contracts once the detail is published.

What are the key Budget 2026 dates for estate agency owners?

What happens next for estate agents?

Most Budget 2026 changes take effect from April 2027, which gives agency owners around five months to prepare staff, sellers and developer clients. Several measures still have details to come.

What should estate agency owners do next?

1. Brief developer clients on Your First Home. Registration opens by the end of December 2026
2. Be ready for landlord sales. Landlords reviewing their portfolios may need valuations before April 2027
3. Prepare prime sellers for the April 2028 surcharge. Valuations near £2 million will attract questions
4. Budget for April 2027 costs. Update payroll, mileage policy and business rates assumptions
5. Review employment contracts. Revisit non-compete clauses when the detail is published

Agencies that act before April 2027 will be best placed to turn new buyer support and landlord decisions into new business.

This article is general information, not tax, legal or financial advice. Speak to a qualified adviser about your circumstances.