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The Budget offers targeted support for first-time buyers, additional housing investment and some potentially valuable work for surveyors and valuers. But higher mortgage costs, weaker transaction forecasts and pressure on housing delivery suggest no immediate return to a buoyant market.

By Andrew McColl, Chairman, Residential Property Surveyors Association

No rabbit, but plenty beneath the surface

There was no Stamp Duty cut on 28 October, and no single dramatic intervention aimed at the housing market as a whole. For anyone hoping the Chancellor would reach into the hat and produce something transformative, this was a quiet Budget for housing.

Quiet is not the same as unimportant. Its effects are simply more targeted, and for surveyors the important question is not whether transaction numbers rise, but what kinds of properties and clients begin arriving on our desks.

Four shifts are worth watching. A government equity loan returns for first-time buyers of new-build homes. A further increase in property-income tax may influence some landlords to sell. A new surcharge creates a hard valuation boundary at two million pounds. And owners of long-term empty homes face a sharper incentive to do something with them. Individually, none of these transforms the market. Together they could change its composition, and composition determines the work reaching a practice.

Your First Home: opportunity accompanied by risk

From spring 2027, eligible first-time buyers in England will be able to buy a participating new-build home with a 2.5 per cent deposit, supported by a government equity loan worth 20 per cent of the purchase price, with no interest on that loan for five years. The Treasury is providing £4.7 billion over five years and expects to support around 70,000 buyers. Pre-registration opens before the end of December 2026, applications from February, first completions from April 2027. It is restricted to new-build homes in England, through participating developers and lenders.

The mechanics are straightforward. The consequences are more interesting.

A buyer completing with a 2.5 per cent deposit may have committed a substantial proportion of their available savings to getting through the door, and is unusually exposed to whatever the property turns out to need. Service and estate charges on new developments often exceed expectations. Defects emerge. Maintenance arrives whether or not you've set money aside for it.

It is also worth being clear about something easily misunderstood. A government-supported purchase is not a government-inspected home. The scheme provides financial assistance and says nothing about condition.

Inspections around a new-build purchase are not interchangeable. A mortgage valuation is carried out for the lender. A warranty inspection tests compliance against the warranty provider's own standards at set stages. A developer's pre-handover check is carried out by the party with the commercial interest in handing over. An independent inspection commissioned by the buyer, and reported to the buyer, is a different exercise altogether. Confusing the four leaves people believing they are protected when they are not.

The RPSA's position is simple. If public money is being used to help people buy new homes, independent inspection should be treated as part of consumer protection rather than as an optional extra. The scheme does not currently require it, and we are not suggesting that it does. We will be making the case that it should.

The valuation work built into the scheme

One detail deserves more attention than it has had. The loan is a percentage of value, not a fixed sum. If the government advances 20 per cent of the purchase price, the amount repayable is normally 20 per cent of the property's value at redemption. That figure moves with the market, so somebody has to establish it. An independent valuation may be required when an owner sells, remortgages, or repays part or all of the loan.

Help to Buy generated a long tail of valuation work for exactly this reason, continuing years after the final completions. A scheme supporting around 70,000 households could do the same.

Two cautions. The valuation requirements and any approved-provider arrangements have not been published, so members should not assume they will be eligible until the rules are known. We will report on them when they appear. Anyone entering this market will also need to understand the basis and purpose of the valuation, the reporting expected, and how buyer improvements are treated in the redemption calculation. That last point is a common source of dispute.

Will landlord taxation release more homes for sale?

From April 2027, property-income tax rates rise by a further two percentage points, following the two-point increase announced in the 2025 Budget. Landlords in England, Wales and Northern Ireland will pay at 24, 44 or 49 per cent depending on their band.

Much of the immediate commentary assumed landlords will now sell in significant numbers. That may prove right, but it is asserted with more confidence than the evidence supports. Highly geared landlords may well decide the returns no longer justify the risk. Others will respond differently: rents may rise where the local market allows, expenditure may be cut, and landlords holding property outright or for long-term capital growth may simply absorb the change. The effect will vary by region, property type and borrowing position, and similar predictions have followed each of the last several tax changes.

Professionally, what matters is not how many former rental properties reach the market, but their condition. A property let for fifteen years may carry a history of short-term repairs chosen for speed rather than durability, alterations made across several tenancies, intensive occupation, and maintenance deferred because it was never quite anyone's priority. It may still present perfectly well at viewing.

The opportunity is not simply more instructions. It is the opportunity to show why a proper inspection matters when a superficially presentable property has a long, complicated history behind it.

The new two million pound valuation boundary

The High Value Council Tax Surcharge applies to residential properties worth £ 2 million or more. It takes effect in England from April 2028, with local authorities expected to issue the first bills in March 2028. Annual charges begin at £2,500 for properties between two and two and a half million pounds, rising through £3,500 and £5,000 to £7,500 above five million.

The Valuation Office will carry out a targeted valuation exercise using comparable evidence and property characteristics including type, age and floor area, with modelling supported by professional judgement. Draft bands are expected in autumn 2027, owners will have rights of challenge and appeal, and revaluations are intended every five years.

Any hard threshold creates disputes. A property at £1,950,000 and one at £2,050,000 are much the same house, but one carries an annual charge and the other does not, and the same logic applies at every boundary above it. Where a property sits close to a line, the gap between two perfectly defensible professional opinions becomes a real and recurring sum of money.

That is why members approached for an informal view should pause before answering. A remark over a kitchen table, or an email written quickly between inspections, could influence a substantial ongoing liability. Purpose, competence, evidence, terms of engagement and professional indemnity cover all matter here, and they matter more than usual because the consequence repeats every year. If this is not work you are set up to do, say so plainly and early.

The market forecast surveyors cannot ignore

The Office for Budget Responsibility expects around 1.2 million transactions in 2026, rising to approximately 1.3 million by 2031, with the total across the forecast period about 4 per cent below its March prediction. The average effective mortgage rate is expected to rise from around 4 per cent to approximately 5 per cent by 2031 as borrowers move off older fixed-rate products, with mortgage payments reaching 4.25 per cent of household disposable income.

It would be wrong to read that as a flat market. Volumes are forecast to grow, but gradually, from a subdued starting point and under continuing affordability pressure.

Competition for instructions is therefore not going to ease, and price-only competition remains as dangerous as ever, arguably more so when volumes are not expanding fast enough to rescue a thin fee. What protects a practice is clear differentiation, genuine specialist knowledge and the ability to explain to a client what they are actually buying. Investment and recruitment decisions should be built on these forecasts rather than on hopes of a boom.

The OBR's warning about housing delivery

The most significant passage in the OBR's outlook, for our profession, concerns housing supply. Weaker supply, it says, partly reflects the cumulative effect of regulatory and fiscal changes introduced outside the planning system over the past decade, particularly since 2019. It identifies the Building Safety Levy, the Building Safety Regulator regime, Biodiversity Net Gain, nutrient mitigation schemes, the Residential Property Developer Tax and higher Corporation Tax. Taken together, it says, these have increased the cost, complexity and timescales of residential development, and have weighed on housebuilding more heavily than it previously assumed.

That finding will be quoted selectively. Some quarters are already reading it as official confirmation that building-safety regulation is holding the country back, and therefore as an argument for stripping it away.

It deserves to be read more carefully. The OBR is measuring the effect of a decade of accumulated change on costs and timescales. It is not expressing a view on whether safer buildings are worth having, and it would be a misuse of a fiscal forecast to pretend otherwise.

Nonetheless, there is a real problem here, and it is worth naming honestly. Implementation has been slow. Requirements have been interpreted inconsistently. Duplication between regimes has added cost without adding safety. Regulatory capacity has not matched the workload created, and uncertainty about timescales costs anyone planning a development. Acknowledging that is not the same as opposing the reforms, and the profession does itself no favours by refusing to say it out loud.

But the response to a slow and under-resourced system is to make it work, not to dismantle the protections it exists to deliver.

The choice is not between building quickly and building safely. That is a false choice. The objective must be a system capable of delivering both, with clear requirements, competent people and regulators, possessing the resources to make timely decisions. Competent professionals are part of that solution rather than an obstacle to it, and the RPSA will make that case wherever this debate goes next.

Other built-environment measures

Several further announcements are worth noting, though the detail that determines their effect is mostly still to come. An additional £1.5 billion is provided for approximately 10,000 social and affordable homes in England, with priority given to Social Rent and council housing. Residential brownfield sites of up to 1.5 hectares in England are to be exempted from Biodiversity Net Gain requirements, with the timetable and impact assessment awaited. The Government does not intend to make major changes to building regulations for the remainder of this Parliament, other than those required to improve building safety and implement Grenfell Tower Inquiry recommendations. Planning authorities must digitise and publish key planning documents as open data by the end of 2027, and the Government intends to make its PlanAssist AI tool more widely available to English councils, subject to testing.

Whether these measures genuinely improve delivery, or simply add another layer of announcements, will depend on how they are implemented. We will return to them when the detail appears.

Surveying practices are businesses too

A few measures affect members directly, as business owners and as people.

The tax-free business mileage rate increases permanently to 55p per mile for the first 10,000 business miles and 35p thereafter. For a mobile profession, this is one of the Budget's most immediately useful operational changes. Rates have been frozen for years while the cost of running a vehicle has risen steadily, so it is worth reviewing how your practice records and claims business mileage.

Alongside that, the 5p reduction in fuel duty continues until 1 July 2027, the zero rate of VAT on domestic electricity continues until the same date, households in English Council Tax bands A to D receive a £100 energy payment from January 2027, and the National Living Wage rises by 3.9 per cent to £13.21 an hour from April 2027, which practices employing staff or trainees should build into their forward budgeting.

Selling a practice

Practice owners planning their eventual exit should note that the lifetime limit for gains qualifying for Business Asset Disposal Relief will fall from £1 million to £500,000 for disposals from 6 April 2027. The Budget also introduces a new Founders' Relief, offering a 10 per cent Capital Gains Tax rate on up to £10 million of lifetime gains, but this is restricted to qualifying founders of high-growth, innovative companies and most conventional surveying practices should not assume they qualify. Members considering a sale, merger or retirement should treat this as a prompt for an early conversation with their accountant, not as advice to rush a decision.

Prepare for a change in work, not a boom

Three practical messages come out of all this.

New-home inspectors should prepare for greater buyer awareness and, in time, greater demand, and should be ready to explain what an independent inspection does that other inspections do not.

Valuers should watch for the detailed equity-loan and surcharge rules as they are published, and should not assume eligibility in either area before those rules are known.

General residential surveyors may encounter more former rental properties, and should be ready for what such properties tend to conceal, but should not plan on a dramatic increase in volume.

Budget 2026 may not restart the housing market overnight, but it could alter the work passing through it. The practices best placed to benefit will be those that understand the new schemes, communicate their value clearly and remain firmly within their competence.

Are you already seeing more former rental properties coming to market, or increased demand for independent new-home inspections? We would like to hear from members. Write to us at info@rpsa.org.uk.

Video AI-assisted summary - sorry, we still don't have a Hollywood budget yet.