Taxation continues to act as a barrier to property transactions, with major reform needed if conditions are to improve, according to Propertymark. The industry body says current tax levels are affecting both buyer and seller activity across the UK housing market, despite falling mortgage rates and relatively stable house prices.
Propertymark’s review of transaction trends highlights the impact of temporary, pandemic-related property tax support, as well as broader economic and financial pressures, on market activity. In 2021, 1,073,308 properties were exchanged, compared with 920,052 in 2025—a 14.3% drop over four years.
In England and Northern Ireland, the nil-rate band for Stamp Duty Land Tax was temporarily raised in 2020–21, reducing upfront costs and helping to stimulate sales. Scotland’s Land and Buildings Transaction Tax and Wales’ Land Transaction Tax saw similar temporary increases in their thresholds. The expiration of these measures, combined with wider affordability pressures, has contributed to lower transaction levels in subsequent years.
Propertymark says these examples show how tax relief or higher thresholds can support market activity: when upfront costs are reduced, buyers are more confident, transactions complete more quickly, and market momentum improves.
In the rental market, the industry body highlights that a major driver of rising rents is the continued lack of supply against a backdrop of growing demand. This pressure has been fuelled in part by higher mortgage rates in recent years, alongside persistent tax increases and rising operating costs for landlords, all of which have constrained rental stock.
Nathan Emerson, CEO of Propertymark, commented: “Lower mortgage rates are a positive step and will undoubtedly help many first-time buyers reassess their options. Combined with modest house price growth, this shows the market is finding a more sustainable footing.
“However, affordability pressures remain complex, and property tax thresholds have failed to keep pace with rising house prices and wage growth over the past decade, increasing the tax burden on buyers.
“Propertymark believes reform is needed to create a fairer, more responsive property taxation systems across the UK that reduce upfront costs, support first-time buyers, and improve market mobility. Alongside this, action to boost housing supply and targeted support for those struggling to save for a deposit will be essential if homeownership is to become a realistic option for more people.”
Propertymark highlights the critical role played by professional agents in guiding buyers through a changing market, helping them with realistic price points, providing market expertise, and helping them handle overwhelming documents and information by explaining each step.
Capital gains tax receipts fall sharply as investors hold back
