The UK government has dropped plans to reduce the threshold for the new High Value Council Tax Surcharge from £2m to £1.5m. The decision means significantly fewer properties will be subject to the High Value Council Tax Surcharge, due to come into effect in April 2028.
Analysis by property agency Yopa shows that of the 792,456 homes currently for sale in England, 11,848 have an asking price of at least £2m. They represent 1.5% of all available properties.
If the threshold were lowered to £1.5 million, the number of potentially affected properties would rise to 22,092, or 2.8% of the market. That’s around 10,244 more properties than the current threshold, and keeping the £2 million limit reduces the additional reach calculated on the basis of current asking prices by 86%.
London has the biggest impact
London is at the centre of the debate because of its significantly higher house prices. The capital is home to 6,963 of all properties in England with an asking price of at least £2 million. This is 59% of the national figure and 5.8% of all homes for sale in London.
At a threshold of £1.5m, the number of potentially affected London properties would reach 11,316, equivalent to 9.4% of the capital’s market. Retaining the higher threshold removes 4,353 homes from this potential range.
“The concern has always been that £1.5m does not necessarily mean a London mansion. In many parts of the capital, that is the price of a perfectly ordinary family home,“ says Verona Frankish, chief executive of Yopa.
She said the lower threshold could affect homeowners who appear wealthy based on the value of their property but do not necessarily have the income or lifestyle typically associated with the term “estate tax“.
Regional differences
Southeast England would be the second-most affected region at a threshold of £1.5m, with 5,025 properties, or 3.4% of available listings, falling into that category. This is followed by South West England with a share of 1.7% and East Anglia with 1.4%.
The new surcharge will be charged in addition to the existing council tax for homes valued at £2 million or more. Official plans foresee it starting to be implemented in England in April 2028.
Detailed statistics on average property prices in Bulgaria by city and district can be seen at imot.bg