Market Update - September 2025

0:00Rob D:Hi listeners, it's Sam here from Property Hub Invest. We love sharing our take on the market with you each week, but we're just as curious to hear about yours. What are you seeing out there? What's working for you right now? And what's got you worried? We've put together a quick survey to find out. It'll only take a couple of minutes, but it will generally help shape what we talk about on future episodes. Head to propertyhub.net forward slash survey to have your say.

0:30Rob B:Hey everyone, it's Robby here with Rob D and it's a big market update this week. Let's face it, everyone's discussing tax. We're going to get into that, the impacts of what it's going to make to you as an investor and also the market as a whole. Of course, we'll be covering house prices, rental reform bill and all the rest of it. There's loads in this episode. Let's get stuck in.

0:56Rob D:Welcome to The Property Podcast. Thank you for joining us. In case you don't know, we run a business that buys more than 100 million pounds of the property for our clients every year. You can find out about that at propertyhub.net slash invest. And that means to do our job, we need to keep up with what's going on in the market. And this is a show where we take it all in, distill it all down and tell you over the space of about 20 minutes or so what you need to know.

1:16Rob B:So let's start as we often do with house prices and Nationwide have published their house price report as they do each and every month. And their headline reads, annual house price growth softens in August. It's an interesting spin because it fell by 0.1%, so I wouldn't class that as growth, but they see it as a softening of growth. Now, that is off the back of July up by 0.05, which was a very strong month, a very strong performance, quite surprising actually. So to see it soften, as Nationwide say, and fallen by 0.1 % isn't a massive shock. That means annual growth with year on year with nationwide is at 2.1%.

1:57Rob B:Halifax on the other hand, well it's up. It's up by 0.3 which means that their annual change now is 2.2%. So they are actually tracking at a very similar level year on year. So that while the monthly numbers might be slightly different, Halifax maybe just slightly behind, but overall there's only 0.1 in it. Not exactly incredible growth. Far from it, in fact. If you account for inflation in real terms, prices are actually falling right now. It's going to be super interesting to see if property in real terms does fall this year. Right now, I still think property will outperform inflation, but we'll see.

2:36Rob B:We haven't got many months left. What is interesting, Rob, I'm not surprised by this trend, but it is interesting, is the continual fall in asking prices. It started really strong at the beginning of the year. Quite surprising, actually, how bullish people were with they're asking prices but the last few months it seems that reality has kicked in and people are

2:55Rob D:reasoned off on what they're trying to achieve that's right the nationwide and halifax data are looking at agreed prices at the point of a mortgage offer being made asking prices are different that's earlier in the process right move puts out that data and they're showing a 1.3 percent drop in the last month which is not unusual for august but what is unusual is that that's the third month in a row the asking prices have come down what they point out in their commentary is that it's not like the market is dying off and everyone's cutting prices to try and get a sale. The number of sales being agreed is 8 % up on last year.

3:27Rob D:But what is happening is it's a very price sensitive market. So they're saying that a third of properties that are currently up for sale have been reduced in price. And that is historically high. It's unusual that it's that higher proportion. And pricing is making a big difference in how long it takes to get a sale as well. So it takes an average of 32 days to find a buyer if it's basically priced correctly in the first place and doesn't need a price reduction versus 99 days if a price reduction is needed. So it takes three times longer to sell basically if you get a bit aggressive in the price and then have to bring it back down again.

4:00Rob D:So what this is all showing is that the market is moving, people are transacting but people are very cautious, people are very price sensitive and I think it's going to be interesting to see what happens with all these figures over the next couple of months because all the speculation and rumours about what might happen in the budget may affect the market and slow things down a little bit. But we will come to that a little bit later. Staying with house prices for now, Rob. A headline I was not expecting to see in Money Week. London house prices to outperform rest of UK, says Economist. Who is this economist?

4:32Rob D:Have they come to this view? This is a contrarian take, if ever I've heard one.

4:36Rob B:Well, being contrarian is something that this organisation loves to be. It's Capital Economics. Capital Economics, famous for being very wrong quite frequently with their predictions when it comes to UK house prices. They have occasionally been right, but you're going to get the time right twice a day as well. They have historically, quite famously within the industry, predicted huge falls when there was strong growth and then vice versa, strong growth when huge falls occurred. So I don't read this and suddenly think, ah, this is one to trust and one to really focus on. What they are very good though is getting media coverage and also very good at not really being followed up by anyone except ourselves in terms of their predictions.

5:19Rob B:But let's see what they've had to say. Now, they say that London house prices will rise by 6.5 % in the next year. Now, it's not been a single year in the last 10 years that it's achieved that level. That would be very, very strong. It is saying, though, that the national average would be 5 % in the next 12 months, which is, again, quite strong, and as we've reported on already, way above the current performance. Now, I wouldn't be surprised to see UK house prices perform stronger in the next 12 months than they have in the last 12 months. And in a couple of weeks' time, we've got a very special episode coming up where we dig into some really interesting data.

5:58Rob B:And based on what we talk about in that episode, I don't feel they're being outrageous there. What really is quite interesting is that point on London. And we both think that London will be investable again in the not-too-distant future. but is the time now? Not sure. It's close right? The yields are improving in certain areas and a lot of the negative headlines is on the prime stuff but when you look beyond prime there is value within the London market. So maybe then Rob, I'm questioning myself now as I've gone through this whole article, maybe it's not as absurd as I first made out. I think the reason why it's quite shocking is it's so contrarian because the northwest in particular has performed so strongly and there's still so much value up there.

6:42Rob B:It's easier to pick that area, which we've done amongst others, to say, okay, those areas, those major cities like Manchester and Liverpool and others are going to perform the strongest. And the data is showing that currently. At some point, London will outperform because it has done in the past the rest of the country. I just don't think it's in the next 12 months. I think we'll see improvement, but that's not hard because it's been so poor. But I think we'll see the improvement. But for me, not enough to justify the headline. But then again, because it's contrarian, it gets the headline.

7:10Rob D:Yeah, I don't think it's an absolutely wild point of view, but I'm still not seeing it. Certainly not yet anyway. And I shouldn't do this because people could go and do it to us. But I did go and Google what they predicted for 2007, which of course is when everything massively fell off a cliff. They said prices would be up three and a half percent that year. So not a flawless track record. But who of us does have a flawless track record? Let's move swiftly on. Let's talk about the rental market because warehouse prices are up a bit. Rents are up a lot but that rental growth is very much slowing so the latest ONS figures are showing that private rents rising at an annual rate of 5.9 % and that 5.9 % sounds great wouldn't object to it but that rate of growth has been falling for something like seven months if you remember it peaked at either double digits or very close to it can't quite remember where the peak was but it was extreme and so what we've seen then is that growth rate coming down basically every month that passes a month of really high growth in the past drops out of the calculation so you'll see that growth figure keeping on coming down so the absolute boom in rents is very much over from everything we've seen in some areas it's definitely overshot and they'll come down a bit but i think what we'll probably see on rental growth is that we will just see that growth number gradually tick down down down until it comes somewhere around the level of inflation which is where it settles

8:29Rob B:over the long term and staying with rents has been an interesting report from a latin agent Benham and Reeves and they've done some analysis of the UK market and while we've reported rents are up still but growth is falling which is expected you can see why with this data because it's really down to supply and demand and there is more supply in the market than there was 12 months ago in pretty much every region. The regions with the highest increase in stock though are quite significant with Bristol, West Yorkshire and Tynanwea topping the table. Bristol up nearly 80 % in stock availability. Now, there is some seasonality in this.

9:08Rob B:It's not suddenly that landlords have gone crazy in Bristol and there's loads of rental stock on the market. It's not an exact science, but it is taken from 12 months ago. So it is useful still to look at this stuff. It is across the board. There's only a few areas where rental stock has fallen, and that's the Isle of Wight, Gloucestershire, and Herefordshire. So if you have property in those areas maybe you're seeing your rental growth performing a little stronger at the moment. It is really down to supply and demand but remember it is still growth. It's not as aggressive as it was and to be honest and it's probably a good thing because it was so aggressive.

9:45Rob B:We had a true rental boom so it's starting to come back down to more normal levels of growth. Let's talk about the biggest news grabber over the last month. The reason you're probably still listening to this podcast. It's the tax changes. It's caused uproar within the property community, not just with investors and landlords, but people connected to the wider community, but people working in the industry as well. And I think it's fair to say, Rob, the rumours, and it's important to stress, the rumours of the proposed tax changes have gone down like an absolute lead balloon.

10:24Rob D:Okay, so let's try to get through some of these proposals. And they are all rumours, and no one really knows where these things come from or how much credibility they have. The one that's generated the much uproar and the one that we did a piece in the Sunday Times about was about national insurance on rental income. So at the moment you'll pay national insurance on your earned income, but you won't pay national insurance on any kind of investment income. And the government is looking at this going, oh, hang on, there's something over there we haven't taxed to death yet. Maybe we can get our hands on that.

10:52Rob D:So talk about maybe applying national insurance to rental income. The thing with this is you don't quite know what the effect of that would be because if it just gets lumped in with everything else and you're already earning more than 50k give or take then that would just be two percent on top which isn't nice but isn't terrible but they could go and create a whole new class for it with its own bands and levels and thresholds and everything else so it could end up being a lot higher. I think the key thing to remember for this one is it would not affect limited companies so there is no concept of national insurance for limited companies.

11:23Rob D:Therefore, if big, big, big, if this did happen, it would be yet another hit for people who own property as individuals. So there's already the mortgage interest disadvantage. This would be yet another hit. So that's the national insurance one. Then we've got the stamp duty one, which at first sounds like good news, but don't worry, it's not going to turn out to be good news. I know we wouldn't be able to cope if there was good tax news. So let's talk about doing away with stamp duty. Any properties worth less than half a million pay nothing and any property is worth more than half a million start paying an annual property tax instead.

11:54Rob D:Now if that one happens again gigantic if around this that sounds like it would be amazing because like well as investors we mostly buy properties for less than half a million so we wouldn't pay any stamp duty. No even though these are just rumours and pretty vague ones at that it's already said this would not apply to investors so don't know what the mechanism would be but they would find some way of making sure that investors continue to pay more than anyone else.

12:16Rob B:And while that's not great, I can see the benefit to this. I'm going to be hated now because I'm actually saying there's something good in the rumor. But I actually think that if they apply this to homeowners, the benefit investors would get is that transactions would suddenly increase quite dramatically. Remember, I'm going to use if again, because it is only a rumor and as you've said Rob a vague one at that but it would dramatically increase movement in the property market and then probably what would happen is an increase in values as well you'd see the property market start to really move upwards in terms of price growth so if this is all to be believed and it happens and I'm not sure it will but if this all happened and investors still have to pay stamp duty I think investors would benefit particularly those who have a portfolio already or are buying at the moment, I think they would benefit by seeing price growth.

13:14Rob B:I think it will really charge the market up. It's something that we've talked about on the podcast before, that removing stamp duty would be a really good thing for the property market. We didn't say, but exclude us investors, please. We put ourselves in that basket as well. But even if we still had to pay stamp duty, I do think that investors will be rewarded in terms of price growth. Again, Rob, there's so many ifs, buts, and maybes, and that's not the end of it. there's more as well.

13:40Rob D:Yeah and I think this next one is even more speculative. This sounds like the most dramatic and it probably is if it happens but it's probably the least likely to happen which is that they do away with not just stamp duty but also council tax and roll it all together into an annual property tax that would affect properties at all levels so there isn't this half million cut off. So the reason that's particularly noteworthy for investors is that the liability would go with the owner not the occupant so at the moment while you've got a tenant in place it's that tenant's responsibility to pay council tax the way this new property tax would work is it would be your responsibility so if you were not able to pass that through in higher rent then that is a whole new extra cost that you previously didn't have i actually think you would be able to pass quite a bit of it on in the rent because the fact it's been removed for tenants immediately increases affordability because their affordability is increased by the same amount that landlord tax burden has increased.

14:35Rob D:So whereas normally I don't think these tax increases on landlords can just be passed straight through, I think this time quite a bit of it probably would be. But it's probably not worth worrying about all this too much just yet, because making this happen would take more than just this parliament. They probably wouldn't even be able to start implementing it until the next parliament. I think we can say there's probably a fairly good chance that we'll have had a change of government by then based on the way things are going right now. So I'd flag this one as highly speculative.

15:02Rob B:Yeah, it's arguably the most controversial out of all the measures because local councils, for a start, will be an uproar. They want to be in control. They won't like this. It'd be so messy to implement, take so long to do. I just can't see this one happening. Rob, I'm going to put you on the spot because you've done a lot of reading up on this. Of all the measures that have been mentioned, do you think any will be implemented? And if so, which one do you think it would be?

15:33Rob D:That's a really good question. I would be far from shocked if none of these ended up making it in. Because we're seeing this not just in property, but across every type of tax you could imagine. There's speculation across all of them. You don't know to what extent this is a deliberate move to try to scare everyone so what they end up doing doesn't seem so bad. To what extent it's seeing what is the least unpopular when they float it so they can implement that one, or what is just leaks. We just have no idea. also side point i think it's really unhelpful that the budget date has now been set for like right towards the end of november that's really late and it just means that the speculation is going to go on for longer and longer which is really damaging in general so i wouldn't be shocked if none of this ended up happening i think the most likely of the three is the national insurance because yeah it is quite a big change but it's one of those that probably wouldn't have too much of a knock-on effect for anything else reckon they could grab a couple of billion and no one would cry too much about it.

16:28Rob B:No one except the legacy landlords, of course.

16:31Rob D:Yeah, exactly. It would just increase that trend we've seen going for the last few years of those legacy landlords being punished and making the decisions about whether to stay in the market or not. So I'd say that's the most likely. The thing that I would most like to see happen, and we've talked about in this podcast before, is an overhaul of stamp duty. The problem is I would like to see a replacement to stamp duty or just doing away with stamp duty done from a position of strength and done in a thought out kind of way with a bit of a plan and maybe i'm being unfair but i feel at the moment they're under such pressure they're reacting almost in panic to everything and they're just not in a position to do anything where there's any kind of short-term pain and so i just fear that if they do touch stamp duty it won't be done as well as it should be the solution won't be optimal and it'll probably have unintended consequences will need endless tweaking and patching over maybe i'm just cynical by this point i've probably been cynical for quite a while if

17:23Rob B:we're honest but can you blame me no rob not at all but that's not all we've got to offer on this subject rob has put together a very good youtube video i sat and watched it all very informative on this very matter if you are not consuming what we're putting out on our youtube channel you're mad you're mad make sure you get yourself over to youtube subscribe turn on the notification bell because if you listen to this the youtube channel allows us to do different content in different ways so having that with this really will level up your industry knowledge will level up your investment skills it's a must do and the thing is it's free this is not something we're selling it's absolutely free we're giving it away so make sure you take advantage of that now i know someone who would have liked to take advantage of the removal of stamp duty because it's really hurt her angela rayner so yes you may have heard that angela rayner has left her government role and And that means we have a new housing minister, Rob.

18:23Rob B:At last, another one. This run had gone on for too long. I felt a bit odd that we'd had a housing minister for so long. But don't worry, the trend of switching up seems to be back. And this week's housing minister, I mean, sorry, our new housing minister is Steve Reid. So Steve Reid, I don't think that's going to change much because all these housing policies seem to be coming top down. So it's just a name of the person who's responsible for that department. but really how much will he or any future housing minister actually have on the market i'm not too sure we'll report on those changes but i don't think it changes much for us as

18:58Rob D:property investors well one of the things that's going to be dropping onto mr reed's desk is the renter's rights bill which is reaching its scintillating conclusion so this week it's been back in parliament they've been talking about it again we're recording this a couple of days ahead so we don't know exactly how that has gone but timeline wise it definitely seems like that's going to be passed soon which means hopefully we will soon be finding out when it's actually going to come into effect and we can start planning for it so we will of course keep you updated on that over the coming weeks and make sure if you're not already you're subscribed to our newsletter because that's normally where we're able to bring you things first because that comes out every friday morning i can be typing away on that thursday night so bring you stuff completely up to date whereas on podcasts and youtube sometimes you have to record a little bit ahead so if you want to know the absolute latest about what's happening with this and everything else you need to know about in property going and signing up for our free newsletter is a great idea you can do that at propertyhub.net slash pulse the link to the newsletter and the youtube channel

19:52Rob B:are in the show notes so go there now well actually don't because we got more it's time for hub extra the part of the show where we give you more and this week we are recommending alex hormosi and his wonderful content now we have mentioned him on hub extra before so why are we mention him again well he has a new book out and he has kindly put that book on his podcast feed for free so i've just started it so i can't recommend the book yet but i think that's great that he does that but also if you have an interest in business then you really do want to check out his youtube channel as well so we're plugging two channels this week on youtube it's excellent it's very good rob and i both watch it we've learned a lot from it and we have been in business a long time so you can never learn too much whatever you do in life but he has some incredible content it's great rob that stuff like that is put out for free we try and do our bit for property but

20:48Rob D:he's doing his bit for business yeah as part of his launch he gave that away for free but he also had an online event where he was selling various other packages where you get more stuff and he sold 100 million pounds worth on the same launch which is something that we have not yet managed to crack but that's quite something but it's great because people who want to pay a lot can pay a lot and people who don't get the book for free and like you said all his free stuff on youtube as well is really good so when you're interested in starting a business getting started in entrepreneurship there is so much stuff out there very hard to know what to pay attention to but i would recommend alex hormoses free stuff to anyone who is in that position so you will find that link along with everything else in the show notes well that's us done for another week we'll

21:27Rob B:be back on sunday in the sunday times answering your questions there make sure you pick that up and we'll be back with Ask Rob and Rob on Tuesday. And then of course, the main event, the Property Podcast will return same time, same place next week on Thursday. Until those truly splendid events take place, take care, have fun. Bye-bye. Bye-bye.

21:50Rob D:Hi listeners, it's Sam here from Property Hub Invest. We love sharing our take on the market with you each week, but we're just as curious to hear about yours. What are you seeing out there? what's working for you right now and what's got you worried we've put together a quick survey to find out it'll only take a couple of minutes but it will generally help shape what we talk about on future episodes head to propertyhub.net forward slash survey to have your say