Nearly 40% fewer properties are changing hands than a year ago, highlighting how the upcoming Autumn Budget has significantly dampened activity at the top end of the market.
There were 39.8% fewer transactions in October than a year earlier, LonRes data shows, though in October last year more deals were brought forward ahead of potential tax changes.
As prices rise there’s a bigger drop-off, as transactions in the £5m+ market are 64.7% lower in October than the same month last year.
In the Autumn Budget on November 26 there are fears the government could introduce a 1% annual Mansion Tax on properties worth over £2m, while it’s speculated that stamp duty could be replaced by a tax affecting properties worth over £500,000.
Nick Gregori, head of research, LonRes, said: “The existing lack of confidence in the market exacerbated by fears of significant tax changes in the upcoming Budget.
“This has started to impact prospective sellers too, with new instructions decreasing, though the volume of stock on the market remains high.
“Unsurprisingly these dynamics are having a negative impact on values, with average achieved prices falling at their fastest rate since February 2024.
“However, with many metrics based on annual comparisons, the downbeat picture painted by the latest figures may be overstating things.
“Last October saw record activity as deals were rushed through ahead of anticipated tax changes, while this year we are seeing something approaching the polar opposite.
“As is often the case, the longer-term context is important and here it shows a market that is below average for the time of year, but not chronically so.”