“The mansion tax, proposed from April 2028 as a £2.5k council tax surcharge for properties more than £2 million and rising to £7.5k for properties more than £5 million, risks creating significant instability in the upper tiers of the property market. This idea has resurfaced under numerous governments, but the fundamental issue remains unchanged in that it is almost impossible to implement fairly or consistently.
“A tax based on market valuations that can swing dramatically year-to-year, particularly following periods like the post-Covid surge, would require constant reassessment by qualified valuers, creating both high administrative costs and inevitable disputes over accuracy.
“More importantly, many owners of higher-value homes are asset-rich but cash-poor, often long-term residents who have seen the value of their homes rise gradually rather than through deliberate gain. A tax that treats these households as though they are high-liquidity investors fundamentally misunderstands the demographic. Such a policy risks trapping homeowners in properties they no longer want or need, directly contradicting the government’s stated desire to free up larger family homes.
“If the top of the ladder becomes stuck, the entire property chain below suffers. For industries like home staging, even before measures come into place, we expect this would translate to a contraction in activity as transactions slow down, with uncertainty clouding decision-making.”
Raising property income tax: Expect many landlords to sell up
“Through raising property income tax from April 2027 by two percent across basic, higher and additional rates, we’re likely to see even tighter pressure on an already-stretched private rental sector. As operating costs rise, landlords will be looking far more critically at how to maximise returns from every property that they let. Many landlords will however choose to sell, contracting the PRS market and inevitably driving up rents further.
“For landlords that will have to now bear the cost of higher property income tax alongside other personal tax measures, investing in presentation is one of the most effective ways to protect profitability and maintain competitiveness in a challenging market.”
A chain reaction down the ladder
“The combined effect of mansion tax, property tax and further personal tax measures is illogical and reflects a government consistently targeting the same cohort of homeowners, many of whom are also employers, business owners, or landlords already strained by rising costs. As these pressures mount, the result will be predictable: people stop moving, delay selling, and avoid investing further in the property market. Demand will be supressed for every related service from removals to white goods, furniture purchases, and of course staging and presentation services, which rely on an active market where sellers are motivated to sell as high and as fast as possible.
“If the premium end of the market stalls, the consequences cascade downward. Mid-market buyers cannot trade up, younger families cannot access larger homes, rental supply continues to tighten as landlords exit under increasing pressure and overall mobility declines.
“We are likely to see two tiers emerge in the market ahead of the mansion tax changes taking effect in 2028. We anticipate the market will be buoyant for properties up to £1.75 million, whereas properties on the £2 million threshold and above will prove difficult to sell. Unfortunately, this could leave many of our beautiful country homes falling into disrepair.
“In such a challenging market, the work of staging may become more targeted and strategic, helping sellers differentiate in a slow market, making properties more competitive where buyers are scarce, and supporting agents who need stronger marketing tools. While staging can help unlock value at the individual listing level, it cannot offset the systemic slowdown caused by policies that disincentivise homeowners from entering the market in the first place.”
