Yorkshire’s property market poised for post-budget rebound as buyers regain confidence
Yorkshire estate agents predict renewed momentum for the property market following months of uncertainty ahead of the budget over tax reform, interest rates and the future of higher-value homes.
Much of the pre-budget tension centred on rumours of wide-ranging property taxes, which contributed to a nationwide fall in buyer demand. Zoopla reported a 12 per cent drop in interest and fewer sales agreed in the four weeks to November 23 compared with last year.
Prices proved more resilient in the North, with Yorkshire and the Humber seeing annual growth of 1.9 per cent. Leeds and Sheffield were among the UK’s strongest-performing cities, with prices rising by 2.2 per cent and 2.1 per cent respectively.
In reality, property taxes came away relatively untouched in the budget, with the announced changes set to impact a far smaller proportion of the market than anticipated.
One of the key measures will see landlords pay an additional two per cent income tax on rental income.
Jonathan Morgan of Zenko City Living says: “In the context of the widely publicised shortage of decent housing stock and the important role that rentals could play in tackling this, it seems nonsensical to add a further burden to the plight of a residential landlord by increasing the tax on rental income.”
While the Chancellor avoided the introduction of National Insurance on rental income, Jonathan warns that further pressure on private landlords risks destabilising a sector that provides “much of the mid-market rented accommodation right across the country.”
He also highlights the budget’s strong focus on Leeds: “Apparently, the Chancellor mentioned Leeds, her political home, 18 times in her budget speech.” The newly announced Leeds City Fund will allow the council to retain 100 per cent of business rates growth for 25 years to support transport, housing and public spaces. Jonathan welcomes the move but questions how its impact might compare to investment mechanisms that have been implemented in other regions.
For homeowners at the upper end of the market, the announcement of a high-value council tax surcharge on homes worth more than £2m from 2028 drew attention. Edward Hartshorne, managing director of York-based Blenkin & Co, says the changes could gently reshape the top tiers of the Yorkshire market.
“Some will recognise that downsizing could be a prudent step toward long-term financial security,” he says. This could bring more large townhouses and country houses to market, easing supply constraints for families.
Edward says the agency’s “micro-reduction” pricing strategy – small, incremental price adjustments – is proving particularly relevant as sellers seek to stay just below emerging tax thresholds.
He expects to see more restructuring and subdividing of estates in response to the new landscape, though he adds that for the highest-value homes the budget amounts to “much ado about nothing”. Encouragingly, he notes increased viewings and offers since the budget, indicating early signs of renewed confidence.
Across the region, performance in the seven-figure bracket has been muted in recent months, but not stagnant. Patrick McCutcheon, head of residential at Dacre, Son & Hartley, says speculation had clearly affected sentiment.
"Viewing levels are down and demand has been blunted, most noticeably for homes priced at £1.3m and above,” he says.
Yet deals have continued. He adds: “On budget day we agreed terms on two properties at approximately £1.1m and £1.25m; earlier in the week we exchanged on a property priced at almost £3m.”
With the budget now delivered, Patrick expects an improved start to 2026, driven by “significant suppressed demand” and stronger buyer confidence.
Competitive mortgage rates – some now dipping below four per cent – are also supporting activity. Lenders including Nationwide and Santander have introduced new reductions, with experts suggesting further cuts could follow.
Nationally, the market is expected to benefit from the traditional Boxing Day bounce. Rightmove says nearly one in five potential movers had been waiting for the Budget before resuming their plans.
Despite wider economic pressures and regional variations in house price growth, Yorkshire’s market remains comparatively stable.
Edward adds: “Yorkshire continues to offer something genuinely special – a wonderful place to live and to do business – and buyers are quick to recognise that.”