House costs rise in November regardless of Budget uncertainty, says Nationwide

House prices edged higher in November, according to figures from Nationwide Building Society.

The typical home went up in value by £772 or 0.3 per cent, rising from £272,226 to £272,998 between October and November. 

This was slightly more than the 0.2 per cent growth between September and October, despite talk of tax rises in the Budget prompting buyers to delay decisions. 

However, compared to this time last year, house prices are 1.8 per cent higher, according to the mutual, less than the 2.4 per cent annual rise recorded in October.

It follows on from last week’s Budget in which Rachel Reeves announced tax hikes on landlords and owners of expensive homes.

Still rising: Prices increased by 0.3% month-on-month, according to Nationwide

The Chancellor said the income landlords get from rent will be taxed at higher rates from April 2027.

The change will see basic rate taxpayer landlords taxed at 22 per cent and higher-rate taxpayers at 42 per cent, which is 2 percentage points above normal income tax rates. 

Landlords who buy or own properties within a limited company will also be impacted, given the Chancellor also upped rates on dividend income by 2 percentage points.

Reeves also announced that from 2028, homes worth more than £2million will face a £2,500-plus  council tax ‘surcharge’ which is being called a mansion tax. 

These announcements could have some impact on future prices, particularly if more landlords sell their properties. 

November saw a drop in the rate of annual house price growth to 1.8% down from 2.4% in October

Jonathan Hopper, chief executive of buying agents Garrington Property Finders, said: ‘There is a palpable sense of relief that the most punitive tax rises that the Chancellor was reportedly considering were left out of last week’s Budget. 

‘The mansion tax may be little more than a speed bump for very wealthy buyers. Of greater concern is the increase in tax on landlords’ rental income, which will prompt more small landlords to sell up – adding to the glut of homes for sale in some areas and driving down prices further.’

While prices might fall, though, he thinks the market activity could pick up given buyers had been sitting on their hands ahead of the Budget. 

He added: ‘With the Bank of England widely expected to cut interest rates again this month, the prospect of cheaper mortgages coupled with property prices that softened substantially over the past few months could propel the market into a flying start to 2026.’

Tom Bill, head of UK residential research at Knight Frank, thinks other Budget measures, such as the freezing of income tax thresholds, will keep prices in check.

‘Property-specific tax hikes are unlikely to affect house prices, particularly in the short-term, but the array of other rises will eventually take their toll,’ he said. 

Robert Gardner, chief economist at Nationwide, said: ‘The changes to property taxes announced in the Budget are unlikely to have a significant impact on the housing market.

‘The high value council tax surcharge, which is not being introduced until April 2028, will apply to less than 1 per cent of properties in England and around 3 per cent in London.

‘Looking forward, housing affordability is likely to improve modestly if income growth continues to outpace house price growth as we expect. 

‘Borrowing costs are also likely to moderate a little further if Bank Rate is lowered again in the coming quarters.’