The Autumn Budget 2025 has delivered some of the most significant property-related changes in over a decade - particularly for higher-value homes, landlords and those with property portfolios in Surrey.

For residents of Ashtead, Epsom, Leatherhead and Fetcham, the headline announcement is the introduction of a High Value Council Tax Surcharge (HVCTS) - widely described as a new Mansion Tax - alongside several other fiscal changes that will affect household finances, landlords’ tax planning and the wider local property market.

Below is a clear breakdown of what’s changing and how it may impact you.

1. New “Mansion Tax” Announced: High Value Council Tax Surcharge (HVCTS)

Applies from April 2028

The Government has confirmed a new annual surcharge on homes valued over £2 million, creating one of the largest structural tax reforms for higher-value property owners in years.

How HVCTS works

Applies to any residential property valued over £2,000,000
Charged in addition to standard council tax
Annual surcharge bands:
- £2,500 for properties £2m–£2.5m
- £3,500 for £2.5m–£3.5m
- £5,000 for £3.5m–£5m
- £7,500 for £5m+
The Valuation Office Agency (VOA) will conduct new valuations beginning in 2026
Revaluations occur every 5 years

Impact on local homeowners

Surrey - and particularly Ashtead, Epsom, Fetcham and Leatherhead - contains a high concentration of properties exceeding £2m. Many homes in:

Ashtead Park, The Warren, Greville Park (Ashtead)
Woodcote Estate, College Area (Epsom)
The Ridgeway, Badingham Drive (Fetcham)
Claremont Lane, Downsview (Leatherhead)

are likely to fall within the new threshold.

This means homeowners may face a recurring annual charge for the first time, which could influence:

decisions to upsize
timing of future sales
longer-term affordability planning

Impact on landlords

Landlords with premium rentals may:

face reduced net yields
consider restructuring portfolios
see increased tenant expectations if rents rise to offset the surcharge

2. Income Tax & Threshold Freezes Continue

The Budget confirmed ongoing freezes to several tax thresholds.

Why this matters locally

With many Surrey residents earning above-average incomes, more households may be pushed into higher tax brackets as wages rise - a form of “fiscal drag”. This can reduce net disposable income, influencing:

buyer affordability
mortgage borrowing capacity
willingness to undertake large home improvements

Landlords paid via PAYE or self-assessment will also feel this impact.

3. Dividend Tax Rates Increase (Affects Company-Owned Buy-to-Let Structures)

For landlords holding property through a limited company, dividend tax rises will increase the cost of extracting profits.

What this means for investors

Smaller BTL companies may see tighter margins
Landlords may reconsider whether to grow portfolios further
Those expanding may need revised tax planning to remain profitable

Given the strong rental market in the KT21, KT22 and KT18 areas, demand remains high - but costs of operating via a company structure will increase.

4. No Change to Stamp Duty Land Tax (SDLT)

Despite speculation, SDLT thresholds and surcharge rates remain unchanged.

Local property impact

Stable SDLT supports:

strong buyer demand
continued activity in the £700k–£1.2m family home market
fewer obstacles for upsizers and relocators

This is positive for sellers across the area, especially where school-driven moves continue to drive demand.

5. Capital Gains Tax (CGT) — No Change, But Low Allowance Continues

The CGT allowance remains at the historic low of £3,000, meaning landlords selling investment properties will face larger taxable gains than in previous years.

Local implications

With strong long-term price growth in Ashtead, Epsom, Leatherhead and Fetcham, even modest gains can lead to significant tax liabilities. Some landlords may choose to:

sell before the HVCTS introduces new holding costs
split sales across tax years
explore more strategic portfolio management

6. Energy Efficiency Incentives Continue

The Budget includes ongoing support for home energy improvements, with grants and reduced VAT on certain upgrades.

Why this matters here

Properties with improved energy performance:

attract higher rents
reduce void periods
appeal to increasingly energy-conscious buyers

Given expected future tightening of rental EPC legislation, proactive upgrades may protect long-term property value.

7. Mortgage Rates & Economic Outlook: Cautious Optimism

The Budget’s economic forecasts signal:

further easing of inflation
gradual reductions in interest rates projected into 2026

For homeowners

Better remortgage options may return
Higher affordability for movers
Stability in the sales market

For landlords

Potential yield improvements
Refinancing becoming more viable
Strong rental demand continuing due to limited local supply

What Does This Budget Mean for the Surrey Property Market Overall?

In summary:

Winners

Buyers under £2m
Sellers of family homes (ongoing demand)
Landlords focused on the mid-market rental sector

Those most affected

Owners of £2m+ homes (HVCTS from 2028)
Landlords with premium rentals
Company-structure landlords reliant on dividends

Market outlook for Ashtead, Epsom, Leatherhead & Fetcham

We expect:

Strong transaction levels below £2m
Increased price sensitivity above £2m
More landlord sell-offs at the high end
Further competition for quality rental homes
Continued resilience in family home demand due to schools, transport and lifestyle

Need Advice on How This Budget Affects Your Home or Portfolio?

Whether you are:

considering selling,
planning renovations,
assessing your rental yields, or
reviewing the value of your £2m+ property ahead of the new surcharge,

our team at V&H Homes is here to guide you with expert, localised insight.

Want to know what your property is worth?