Sussex property news: a 2.5% deposit scheme for new builds, landlord tax rises and prices flat in October (31 October 2026)
The 28 October Budget set out the Your First Home equity loan for first-time buyers, raised tax on rental income from April 2027 and confirmed the bands for the £2 million council tax surcharge. It left residential stamp duty rates alone. Nationwide, Zoopla and the Bank of England all reported a slow autumn market, and Horsham's local plan cleared its final hearings.
Budget: Your First Home lets first-time buyers put down 2.5% on a new build, applications from February 2027
The Budget confirmed £4.7 billion for Your First Home, an equity loan scheme for first-time buyers of new-build homes in England. Buyers need a deposit of at least 2.5%, take a repayment mortgage from a participating lender, and the government lends 20% of the price. The loan is interest-free for five years, then charged at 1.5% in year 6 and 3% from year 7. Household income must be £110,000 or less outside London.
Each local authority area gets its own price cap. The government's examples are Reading £375,000, Manchester £355,000 and North Devon £320,000; the full list, including Sussex districts, has not been published yet. Pre-registration opens by the end of December 2026, applications in February 2027 and the first sales in April 2027. On a £300,000 home the government's example shows £1,248 a month for the first five years against £1,530 on a standard 95% mortgage, assuming a 5% rate.
Savers also got changes. From 29 October the Lifetime ISA withdrawal charge falls from 25% to 20% for first-time buyers whose home costs more than the £450,000 cap. A new First Time Buyer ISA replaces the Lifetime ISA for new savers from April 2029, with a 25% bonus capped at £20,000 on homes up to £450,000. The Budget's stamp duty measures were technical (group relief, pension pooling, rent under assured tenancies); residential rates and bands were not changed.
Sources: MHCLG, Your First Home, 28 October 2026, HM Treasury, Budget 2026, 28 October 2026.
Budget: landlords pay 24%, 44% or 49% on rental profits from April 2027; £2m homes face a £2,500 to £7,500 surcharge from 2028
Income tax on property income rises by a further two percentage points from 6 April 2027, so the property basic, higher and additional rates become 24%, 44% and 49% in England, Wales and Northern Ireland. That is on top of the two-point rise announced in Budget 2025 for the same date.
The government also published its response on the High Value Council Tax Surcharge, a new annual charge from April 2028 on homes in England worth £2 million or more. There are four bands: £2,500 (£2m to £2.5m), £3,500 (£2.5m to £3.5m), £5,000 (£3.5m to £5m) and £7,500 (over £5m). A deferral scheme, discounts and exemptions are confirmed, and homes left empty and unoccupied for 12 months or more pay a 100% premium. The government expects around 150,000 people to be affected.
Sources: HM Treasury, Budget 2026, 28 October 2026, HMRC, High Value Council Tax Surcharge, 28 October 2026.
Nationwide: annual price growth slows to 0.5% in October, the weakest since January 2024
Nationwide's UK index showed prices flat month on month in October and up 0.5% on a year earlier, down from 0.8% in September. The average price was £273,566, against £274,251 a month before.
Chief economist Robert Gardner linked the slowdown to higher market interest rates, driven by expectations of Bank Rate rises as energy prices push up inflation, and said surveyors report weak new buyer enquiries.
Bank of England: 53,400 mortgage approvals in September, the rate on new loans up to 4.63%
Approvals for house purchase fell to 53,400 in September from 54,800 in August, below the previous six-month average of about 58,800. Remortgage approvals with a new lender rose to 42,600 from 34,000. The effective rate on newly drawn mortgages rose to 4.63% from 4.60%.
Asking rates on new deals barely moved in the run-up to the Budget. Moneyfacts put the average rate across all new mortgages at 5.88% on 27 October, with the average two-year fix at 5.97% (5.92% a month earlier) and the five-year fix at 5.99% (5.94%).
Sources: Bank of England, Money and Credit September 2026, 29 October 2026, Mortgage Strategy (Moneyfacts data), 28 October 2026.
Zoopla: prices falling in 85% of London and South East postcode areas, with 7% more homes for sale
Zoopla's October index put the UK average at £273,100, up 0.8% on the year, but said prices are falling in 85% of postcode areas across London and the South East, and are slightly down across the South East region. Buyers have 7% more homes to choose from than a year ago, and sales agreed are 7% lower (9% lower last month).
Homes that do sell find a buyer in 44 days on average. Pricing matters: 41% of homes listed below their estimated value between April and June found a buyer within 90 days, against 26% of those priced at least 20% above it, and only 19% of homes that had a price cut sold within 90 days.
Horsham Local Plan: inspector's preliminary view is that the plan is sound, final report expected early 2027
The examination hearings on Horsham District's Local Plan ended on 22 October. Planning inspector Jonathan Bore's preliminary conclusion is that the plan is sound on housing numbers, affordable housing, development management policies and the spread of growth across the district. A short technical consultation on a few further main modifications comes next, and the inspector expects his final report to reach the council early in the new year, after which the council can adopt the plan.
Campaigners from Save West of Ifield, who oppose Homes England's plans for up to 3,000 homes west of Crawley, told the hearings that traffic from Kilnwood Vale, West of Ifield and Crabbet Park had been underestimated.
Sources: Horsham District Council, 23 October 2026, SussexWorld, 26 October 2026.
What this means if you are moving home in Sussex
First-time buyers looking at new builds should wait for the local price caps before planning around Your First Home; pre-registration by the end of December is free of commitment and will show the cap for your area. Lifetime ISA holders buying above £450,000 now lose less on withdrawal.
Landlords have until April 2027 before the higher property income rates bite, which is time to review yields and ownership structure with an adviser. Sellers face more competition for fewer buyers: Zoopla's data says the first asking price matters more than a later cut. Buyers have more choice and room to negotiate, but rates on new fixes are still close to 6%.