If you’ve signed up with Hello Mortgage over the past year, you’ll want to know how yesterday’s Autumn Budget could affect your plans. With the Chancellor’s announcements now out, we have a clear picture of what the government intends to do with the economy over the coming months, and what it means for the property and mortgage market.
The top headline from yesterday’s Budget is that every household in council tax bands A to D will receive £100 from the government to help with rising energy bills this winter.
Changes to ISAs for first-time buyers
The Budget also confirmed plans to introduce a new First Time Buyer ISA from April 2029, replacing the Lifetime ISA for new savers. The new account is designed to make saving for a first home simpler, while retaining the government bonus that has made Lifetime ISAs an attractive option for many buyers.
Under the proposed plans, savers will be able to contribute up to £4,000 a year and receive a 25% government bonus, worth up to £1,000 annually. The bonus will be applied when the money is withdrawn towards an eligible first home purchase, with a maximum property value of £450,000. Unlike the Lifetime ISA, the new account will not have an upper age limit.
For anyone who already has a Lifetime ISA, there is no need to panic. Existing account holders will be able to continue saving into and using their accounts under the current rules, even after the new ISA launches.
The Budget also brings an immediate change for existing Lifetime ISA holders looking to buy a property above the £450,000 price cap. From 29 October 2026, the withdrawal charge for eligible first-home purchases above this limit will fall from 25% to 20%. This change is intended to protect the value of savers' original contributions, although the charge will still apply.
With further details of the new First Time Buyer ISA expected in due course, anyone saving towards a deposit should keep up to date with the changes and consider how they could affect their plans. If you are unsure how the rules apply to your circumstances, speaking to a mortgage adviser can help you understand your options.
Landlords and Stamp Duty
Despite the rumours, there were no changes to Stamp Duty in yesterday’s Budget. Landlords, however, will see tax on their property income rise by a further 2 percentage points from April 2027, taking rates to 24%, 44% and 49% depending on their tax band.
The High Value Council Tax Surcharge on homes worth £2 million and above is going ahead, with the first bills due in March 2028.
Looking forward
Looking ahead, the Bank of England’s next interest rate decision is on 5 November, with markets currently pricing in a 93% chance of a 0.25% rise. For anyone with a mortgage application in progress, this is one to watch.
In the meantime, the Budget offers some immediate relief on the cost of living, from the £100 energy bill payment to the scrapping of the standard rate on gas delivered to homes. Small changes like these could have a lasting effect.
If you’d like to talk through what yesterday’s Budget means for your mortgage plans, the Hello Mortgage team is here to help.
Disclaimer: Your home may be repossessed if you do not keep up with mortgage repayments.
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