Why Buyers Vanished in July: It's the Budget, Not Rates

By Lisa Hayes · 15 August 2026

Buyer numbers across London fell 22% year-on-year in July, according to agency Chestertons — the sharpest drop since the run-up to last November's Budget. The agency blames speculation about property taxes rather than anything happening to house prices or mortgage rates, and reckons Andy Burnham's early decision to rule out stamp duty changes in October could bring buyers back. If you're trying to sell right now, this matters more than any house price index: the thing holding up your sale probably isn't your asking price. It's a Budget nobody has written yet.

• 1,740buyers registered with Chestertons' London branches in July
• -22%fall in buyer registrations year-on-year
• -28%RICS net balance for new buyer enquiries, UK-wide
• 3.75%Bank of England base rate, held five meetings running

What actually happened?

Chestertons, which runs a network of branches across the capital, counted 1,740 prospective buyers registering with its offices in July. That's 22% fewer than the same month last year. The agency is clear about the cause: people are waiting to find out what the Chancellor does to property in October before they commit hundreds of thousands of pounds.

The comparison the agency draws is the telling one. The last time registrations fell this hard was immediately before the November 2025 Budget, when the drop hit 29%. Same pattern, same trigger. Buyers don't disappear because they've stopped wanting to move. They disappear because they've been told, repeatedly, across months of newspaper front pages, that the rules on property tax might change — and nobody wants to exchange contracts three weeks before finding out they've overpaid.

Adam Jennings, Head of Residential at Chestertons, put it plainly: "The lesson from last year was that people don't want to make a big decision in uncertain times when so much money is at stake. Inevitably, they are inclined to 'wait and see'."

His argument is that Burnham's early, heavily publicised statement that stamp duty will not be abolished in October's Budget removes one of those question marks. "By ruling out changes to stamp duty in the upcoming Budget, the Prime Minister has removed a significant question mark for buyers," Jennings said. "Hopefully, that position remains in place for at least the next 12 months and gives the market the certainty it needs."

It's a fair point. It's also, I'd argue, only about a third of the story.

Why does tax speculation freeze the market so completely?

Because buying a house is the one purchase where a rule change of a couple of percentage points can cost you the price of a car.

Think about the mechanics. Someone buying a £600,000 home is already writing a cheque for stamp duty on top of the deposit, the survey, the solicitor and the removals van. If there's a credible rumour that the banding might change, or that a new annual charge might land on higher-value homes, or that reliefs might be reworked, then the rational move is to wait eight weeks. The cost of waiting is a slightly later move. The cost of not waiting could be five figures. Almost everyone waits.

And the freeze doesn't stay in the price bracket where the rumour sits. Chains are the transmission mechanism. If the person buying the £600,000 house pauses, the person selling it can't buy the £900,000 house, and the first-time buyer at the bottom of the chain — who has no exposure to any of these proposed changes whatsoever — finds their purchase has quietly stopped moving. One hesitant buyer at the top of a five-link chain takes four other households out of the market with them. If you want to understand why the whole market can seize up over a policy that would only affect a minority of homes, that's the answer. And if your own sale has gone quiet for reasons nobody can quite explain, it's worth reading our guide to what to do when a property chain breaks.

The mansion tax proposal — a charge on homes valued above £2 million, due to be collected alongside council tax from April 2028 — is a good example of how narrow a policy can be while still spooking a wide market. Very few UK homes are worth £2 million. But the conversation it started, about whether property is going to be taxed more heavily and more regularly, has reached people selling three-bed semis in Stockport.

Is this just a London story?

No. And this is where the Chestertons numbers become genuinely useful rather than just a London curiosity.

The July RICS UK Residential Market Survey, published on 13 August, includes hundreds of comments from chartered surveyors around the country. Read them in sequence and the same word appears again and again, in every region, from people who have no particular reason to agree with each other.

Edward Rook of Knight Frank in Sevenoaks: "There appears to be limited understanding of the impact that tax speculation has on the market. Uncertainty stagnates markets and recent policy signals have compounded this."

Simon Hobbs in Newcastle: "Political uncertainty re possible tax increases is causing buyer reticence."

James Ottewell in Derby: "The sales market remains challenging not helped by political uncertainty and potential land tax changes."

David Robinson, covering Cornwall, West Devon and Torridge: "Traditional school holiday lull in activity but definite undercurrent of uncertainty with new PM and likely increased tax exposure for property market."

Michael Brooker in Crowborough, East Sussex, described a buyer's market with a "lack of confidence from applicants" who are "concerned re mortgage rates/stamp duty etc."

That's the North East, the South East, the East Midlands and the South West all describing the same thing. This isn't a Zone 2 flat problem. It's national, and it has been building since the spring.

What the July numbers actually show

Strip out the commentary and the RICS survey reads as a market that has stopped getting worse without showing any real sign of getting better.

New buyer enquiries came in at a net balance of -28% for the second month running. That's firmly negative, but it's a long way back from the -41% recorded in March, which was the low point of the year. Agreed sales sat at -30%, also unchanged on June, and better than April's -37%. The headline house price gauge improved slightly to -30% from -32% in June — still indicating widespread downward pressure, but drifting in the right direction from April's -35%.

The forward-looking numbers are the interesting ones. Surveyors expect prices to keep falling over the next three months, at a net balance of -31%. Over twelve months, though, they turn mildly positive at +4% — down from +8% last month, but positive. Near-term sales expectations have improved for four consecutive surveys, now at -14%. Twelve-month sales expectations reached +3%, the most optimistic reading since February.

Translation: the people who value houses for a living think the next three months will be grim and the twelve months after that will be better. Which is exactly the shape you'd expect if the market is holding its breath for a specific event in October.

One number cuts against that reading, and it's worth flagging honestly. RICS reported that twelve-month price expectations for London have slipped to -23%, from -10% previously. Surveyors have got materially more pessimistic about the capital over the past few surveys. So while Chestertons is optimistic about a post-clarity bounce, the wider surveying profession is not — at least not in London.

The regional picture: two countries, one housing market

Lloyds' July house price index put the average UK property at £299,253, effectively unchanged on the month and just 0.1% higher than a year ago. That flat national number hides a split that's now hard to ignore.

Nation / region	Annual price change	Average price
Northern Ireland	+7.4%	£231,131
Scotland	+3.6%	£223,246
North East England	+2.8%	—
North West England	+2.1%	—
Wales	+1.6%	£231,458
Greater London	-1.3%	—
South East England	-2.0%	—

Figures from Lloyds, covering the twelve months to July 2026.

Nicholas Finn, managing director of Garrington Property Finders, reads it this way: "In southern areas a glut of supply is attracting too few serious buyers, and this is steadily dragging down prices. Buyers are often able to ask for, and get, reductions on the asking price. Meanwhile many struggling sellers are cutting prices pre-emptively to attract interest, with those putting their home on the market now often facing an uncomfortable reality check on their price expectations."

He's blunter still about the mood: "The market craves stability, but at present all we're getting is stasis at best."

The northern picture is different because the arithmetic is different. Supply and demand are closer to balanced, prices started lower, and the Number 10 North relocation has done something for sentiment. But — and this matters if you're in Newcastle or Leeds and feeling smug — RICS reported that Scotland's price trend, which had been climbing steadily for a long time, now appears to be flattening out. The gap is real, but it isn't guaranteed to keep widening.

If you want to see how your own area is behaving rather than relying on national averages, our UK house prices tracker breaks the picture down properly.

What about mortgage rates? Aren't they the actual problem?

They're a very big part of it, and I'd push back on anyone who tries to pin the whole slowdown on Westminster.

The Bank of England held the base rate at 3.75% on 30 July — the fifth consecutive hold. But base rate isn't what you pay. Moneyfacts recorded the average new mortgage rate rising from 5.47% in July to 5.59% at the start of August, reversing the previous month's cut. Average two-year fixes reached 5.63% and five-year fixes 5.66%, both up on the month for the first time since April.

Now the number that should stop you: that same average two-year fix was 4.83% on 27 February, the day before Middle East tensions escalated. Eighty basis points, in under six months, on the deal most movers take. On a £250,000 repayment mortgage over 25 years, that's roughly £120 a month — money that comes straight out of what a buyer can offer you.

Individual lenders have been cutting selectively — Nationwide trimmed fixed rates by up to 0.19 percentage points in the week to 7 August, Barclays cut ten-year fixes by half a percentage point, Coventry and Virgin Money made smaller reductions. But the market average went up. When lenders cut headline products while the average rises, they're competing for a shrinking pool of borrowers rather than passing on genuine funding relief.

So: two brakes on the same market. Rates make buyers poorer. Tax uncertainty makes them hesitant. Rates have been grinding away since February. The tax freeze arrived in the past few months and is the newer, sharper effect — which is why Chestertons' July drop looks so abrupt.

Has Burnham actually fixed anything?

Partly. Let's be precise about what has and hasn't been ruled out, because the headlines have been sloppy.

What's been ruled out: abolishing or restructuring stamp duty in October's Budget, and — according to reports — replacing stamp duty and council tax with a single annual property tax at this stage. That's genuinely useful for anyone buying in the next few months. It's the single biggest transaction cost on a purchase, and knowing it isn't moving lets a buyer do their sums with confidence.

What hasn't been ruled out: the mansion tax on homes over £2 million, which is still scheduled to be collected alongside council tax from April 2028. Capital gains treatment. Council tax revaluation. And the cross-party Housing, Communities and Local Government Committee has recommended the government consult by the end of 2026 on replacing or overhauling stamp duty entirely — which means the question comes straight back next year even if it's off the table this October.

So the honest read is this: one specific fear has been removed, and the broader anxiety that property is going to be taxed more has not. Chestertons is an estate agency, and estate agencies are professionally optimistic. I'd treat "this should restore confidence" as a hope rather than a forecast. What I'd say with more confidence is that a partial reduction in uncertainty is still a reduction, and buyers who were sitting on their hands specifically over stamp duty now have a reason to move. That's not nothing when the market is this thin.

What this means if you're selling right now

Three things, and none of them are comfortable.

First: your buyer pool is smaller than it was a year ago, and that has nothing to do with your house. If you've had three viewings in six weeks and you're wondering what's wrong with your kitchen, the answer may be that 22% fewer people are looking. Take that personally at your peril — but don't use it as an excuse either, because the buyers who are out there are being very picky about price.

Second: the buyers still active are unusually serious. Perry Stock, a surveyor near Cobham, described it well in the RICS survey: "Unless forced to via jobs, new born, divorce etc — very few people are choosing to move. In other words — enforced choice to move rather than electing to move." The discretionary movers have gone home. What's left is people who genuinely need to transact. They will proceed, and they will negotiate hard, because they know how thin the competition is.

Third: pricing is now doing almost all the work. This came up in nearly every regional comment RICS published. Tony Dobbins in Darlington: "realistically priced homes still selling quickly and ambitious ones stalling before correcting." Richard Addington in Devon: "Plenty of choice for buyers so overpriced property unlikely to attract much interest." Howard Davis in Bristol: "We continue to lower asking prices to secure sales."

Nick Millinchip, a surveyor in Stourport-on-Severn, made the point that indices haven't caught up with reality: "Although not fully reflected in published indices, my experience is that house prices are falling locally." That gap between published averages and what's actually being agreed is where a lot of sellers lose months. If your valuation was done in spring, it's probably optimistic now. Getting an honest read on what your home is worth today is the single highest-value hour you can spend — our guide to what your house is actually worth walks through how to do it without kidding yourself.

What should you do over the next eight weeks?

The Budget is in October. That gives you a defined window, which is more than sellers usually get.

If you're already on the market: review your price now rather than in September. Every week you spend above the market is a week of accumulating "days on site", and buyers read that number as a discount signal. The evidence backs this up brutally — analysis of 2026 sales found homes selling within three months took an average discount of 3.9%, while those on the market more than twelve months took 19.3%. That's a 15.4 percentage point penalty for being stubborn early. Cut once, decisively, to a number that gets viewings. Drip-feeding £5,000 reductions every six weeks is the most expensive strategy in property.

If you haven't listed yet: you have a real decision to make. Listing into a quiet August and September means fewer viewings but also far less competition — new instructions have collapsed, with the RICS balance at -4% against -23% the month before, and market appraisals suggesting the pipeline of listings stays tight. Waiting until after the Budget means more buyers but also a wave of other sellers who had the same idea. My honest view: if your home is well-presented and you'll price it properly, list now and be the only decent option in your bracket rather than one of thirty in November.

If you're in a chain: check in with every link, this week. The single biggest risk in a market like this isn't price, it's collapse. Get your paperwork ready, instruct your solicitor early, and know where the weak link is before it snaps rather than after.

If your buyer is a first-time buyer or has a mortgage in principle from the spring: ask them to re-check it. Rates have moved. An agreement based on February pricing may not survive an August affordability check, and you want to know that now rather than in week nine of the conveyancing.

What if you genuinely can't wait?

Plenty of people reading this don't have the luxury of timing the market around a fiscal event. Probate, divorce, a job move, a broken chain, a repossession clock — the reasons people need certainty rather than the best possible price are usually the reasons you'd least want to explain to a stranger.

If that's you, the open market's current problem is that it offers neither speed nor certainty. Homes are taking longer to sell, more sales are falling through, and buyer numbers are down. That combination is exactly when it's worth understanding what the alternatives actually offer.

Cash buying companies will complete in weeks rather than months and won't pull out over a mortgage valuation, because there isn't one. They also pay below open market value — typically a meaningful discount, and anyone who tells you otherwise is selling you something. Whether that trade is worth it depends entirely on what the delay is costing you. If you're paying two mortgages, or a probate property is sitting empty and insured at penal rates, or a chain has already collapsed twice, the arithmetic can genuinely favour certainty. If you simply fancy a quicker sale, it usually doesn't.

The critical thing is comparison. Offers from different cash house buyers vary enormously for the same property, and the highest first offer is not always the one that completes at the price quoted. Our guides to selling your house fast and the best house buying companies in the UK cover what to check before you sign anything. And if the terminology is getting in the way, property jargon explained is there for exactly that reason.

The dates that actually matter

Four things are worth having in your diary between now and the autumn.

Wednesday 19 August: the June UK House Price Index from ONS and HM Land Registry, at 9.30am. This is the sold-price data — the most accurate measure there is, and the slowest. It'll tell you what completed in June, which reflects deals agreed in the spring.

Thursday 10 September: the August RICS survey. This is the first read on whether the stamp duty announcement moved the needle on buyer enquiries. If the new buyer enquiries balance improves meaningfully from -28%, Chestertons was right. If it doesn't, the freeze is about more than stamp duty.

Thursday 17 September: the Bank of England's next rate decision. Markets are split, and some commentary suggests financial markets have been pricing in the possibility of rises rather than cuts. A hold is the base case. Anything else moves mortgage pricing quickly.

October: the Budget itself. Whatever it contains, the uncertainty ends that day, and a lot of paused decisions restart.

The bottom line

The story of this market isn't that Britain has fallen out of love with moving house. It's that a large number of people have decided to move later rather than never, and they've all picked roughly the same date to decide on. That's a queue, not a collapse — and queues clear.

But "it'll be better in twelve months" is cold comfort if you need to be out by Christmas. If you're selling into this, the two things within your control are price and certainty. Price honestly against what's selling near you today, not what your neighbour listed at in April. And if the timeline matters more than the last few percent, find out what a guaranteed sale would actually look like before you spend another four months finding out the hard way.

Either way, start with a number you can trust. Compare offers from vetted buyers alongside a realistic open-market valuation, and make the decision with both figures in front of you. It costs you nothing to know, and in a market this uncertain, knowing is most of the battle.