Autumn Budget 2024: What to Know

Earlier in the year, PM Sir Kier Starmer warned us of what was to come, saying that the Autumn Budget was going to be “painful”. So, now that it’s out, is it as bad as we expected for the property scene?

Capital Gains Tax changes 

Capital gains tax (CGT) is charged on profits you make from selling an asset like a second property or shares. Chancellor Rachel Reeves has decided to increase CGT on the sale of shares and other assets: from 10% to 18%, while the higher rate will rise from 20% to 24%. This plan works so asset owners pay their fair share whilst keeping the UK tax system internationally competitive - and the rates remain lower than comparable European countries.

Stamp Duty surcharge 

This one wasn’t surprising as it was outlined in Labour’s manifesto pledge: an increase to the stamp duty surcharge for second homes. It will rise to 5% (from the previous 3%). The rate will start from the 31^st October, 2024.  

First-time buyer stamp duty

In September 2022, the threshold for paying first-time buyer stamp duty was increased from £300,000 to £425,000. This move was to benefit first time buyers and encourage more onto the market – in short, it was only announced as a temporary measure and is set to be reversed in April 2025.  

We were waiting hopefully to see if Labour might extend this relief for first-time buyers, but no such luck. From April next year, first-time buyers will pay 5% on values between £300,001 and £500,000, and will lose their relief on prices above that. This means those looking to buy for the first time may need to have more cash in the pot to cover stamp duty fees. To see what you could pay in stamp duty right now, use our Stamp Duty calculator here. 

Mortgage guarantee scheme

Over the coming months, the government plan to work with the industry on the mortgage guarantee scheme, with plans to make it permanently available to support lending at 95%, ending the stop-start availability of the scheme and giving lenders confidence throughout the cycle. This scheme makes it easier for first-time buyers to realise the dream of home ownership, requiring a lower deposit. The government will bring forward further details in Phase 2 of the Spending Review - more to come!

Housing 

We always knew this was coming – the government will spend £5bn on housing, increasing the inventory of affordable housing. They plan to reduce the right-to-buy discounts. The idea is for the local governments to retain the earnings from council housing sales, allowing them to reinvest. The chancellor said this would provide £5bn to deliver housing plans next year. 

Find out more

Of course, the Autumn Budget of 2024 also released more changes that may impact your finances. Check out the full summary here.