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This is Chubby Wallet. The newsletter that teaches you how to profit from property trends before they go mainstream..

Here's what’s in store..

• Why the property market will bounce back in 2026

• Renters reform to backfire on tenants

• Autumn budget: relief or raid for property owners

LATEST DEVELOPMENTS

HOUSING OUTLOOK

Rightmove signals 2026 UK property rebound

New data suggests 2026 is shaping up to be a steadier year for UK property. Prices are under pressure now, mortgage rates are easing, tax uncertainty has reduced, and most analysts expect a slow return to growth rather than anything dramatic.

The details:

• Rightmove reports the sharpest November fall in asking prices since 2012, with many sellers cutting prices and buyers gaining more room to negotiate.

• The Autumn Budget avoided a broad tax rise on homes in the £500k–£1m range, clearing up uncertainty for most of the market while placing the extra burden mainly on £2m+ homes and landlords with heavy borrowing.

• Forecasts point to more activity in 2026 as the impact of the Budget settles and many would-be movers who paused decisions in 2025 return.

• Mortgage rates have edged down from last year and markets still expect at least one rate cut, which is a key reason analysts are now predicting small increases in prices next year.

• Agencies including Savills, Knight Frank, JLL and Capital Economics now expect low-single-digit price growth in 2026, with some upside if borrowing costs fall faster.

• The UK’s long-standing shortage of homes continues to support prices. Even slight improvements in demand tend to push the market upward because supply has lagged for years.

• Regional trends vary: several northern, Scottish and Welsh cities are expected to perform better than the national average, while London and the South are expected to return to modest growth after a weaker period.

• Rental forecasts remain firm, with steady growth expected in 2026 as tenant demand stays high and some landlords exit the market.

Why It Matters

The current correction is helping the market reset after two difficult years. By 2026, falling borrowing costs and clearer tax rules are expected to pull the market back toward gentle growth. It won’t be a boom, but it will reward buyers preparing early, sellers who price realistically and investors taking a long-term view.

RENTERS REFORM ACT

Why renters reform could backfire on tenants

The shift away from Section 21 and heavier reliance on Section 8 is being framed as a win for renters. Early signals show the opposite: tougher screening, fewer available rentals, rising rents and a faster move toward landlord consolidation.

The details

• Section 8 is now the main route for eviction, and it leaves a record. Section 8 is used when a landlord wants to evict a tenant for specific legal grounds (rent arrears, property damage, breach of contract, etc.). Because it goes through the courts, it creates a public record that shows up in standard checks.

• Screening will tighten sharply. Since Section 21 (the “no-fault” route) is being phased out, more evictions will go down the Section 8 path. Agents will treat any Section 8 history as a red flag. The result: more tenants rejected before they even view a home.

• Landlords are already leaving the traditional rental market. Buy-to-lets are being sold. Many landlords are switching to HMOs, serviced accommodation and social housing — partly for yield, but mostly to avoid the new tenant rules. That removes a large chunk of standard rental homes from the system while demand keeps rising.

• Fewer homes and higher demand mean higher rents. When supply falls and competition grows, landlords can raise rent — and the market absorbs it. That’s the direction agents are already forecasting.

• Expect more unlawful evictions. Formal Section 8 cases can take close to a year. If a landlord is under financial pressure, some won’t wait. There’s already an underground market offering “removals” for a small fee — and tenants are the ones exposed. Families will face late-night “bailiff-style” visits with little warning.

Why It Matters

Section 8 leaves a trace. Section 21 didn’t. That single shift changes the entire balance of the rental market. Tougher checks, fewer properties and higher rents will shape the next phase of renting in the UK. The intention may be protection, but the practical effect is reduced choice, rising costs and more control in the hands of large landlords.

BUDGET UPDATE

AUTUMN BUDGET

Budget raids premium property owners

The 2025 Autumn Budget didn’t deliver a full-scale assault on property owners, but it did hit landlords and high-value owners with a mix of higher taxes, new levies and frozen thresholds. The headline: working landlords face tighter margins, luxury owners face a new annual bill, and the market edges further toward consolidation.

The Details:

• The government avoided the biggest feared measures, no National Insurance on rental income and no overhaul of stamp duty — but still raised taxes on rental profits and added a new annual charge on homes worth over £2m.

• The new “mansion tax”-style levy applies from 2028: 1% each year on properties valued above £2m, using 2025 valuations. Owners, not sellers, pay it — meaning holding expensive homes becomes far costlier. Analysts expect more selling in London and the South East before the levy begins.

• Rental income tax rises by 2% in 2027 across all bands. With income tax thresholds frozen until 2028, many working landlords will be pushed into higher tax brackets simply through inflation and normal pay rises.

• No increase to capital gains tax, but the annual exemption stays small (£3k). That allowance is now also the cap on gifting for inheritance planning, tightening family transfers.

• Analysts warning: The combination of higher taxes, tighter rules and the upcoming end of Section 21 could push 10–15% of small landlords to exit. Reduced rental supply and strong demand are likely to push rents up 4–6% next year.

• Smaller landlords feel the pain most. Larger portfolio landlords can absorb voids, legal delays and new mandates; smaller owners can’t. The result is a steady drift of properties away from individual owners toward corporate players.

Why it matters

This Budget tightens the screws on working landlords and raises the cost of owning high-value property, without offering meaningful new relief. The changes don’t break the sector, but they push smaller landlords closer to selling, drive rents up through reduced supply, and accelerate the shift toward larger institutional owners. For investors, the message is clear: higher tax, higher compliance, and a need for sharper planning to stay profitable in the next phase of the market.

That's it for this week folks. Each week we'll cover strategies, updates and insights to help you succeed in real estate. We love this stuff!

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