Homeowners with valuable properties will be forced to hand over between £2,500 and £7,500 to the Treasury every year from 2028 in a so-called ‘mansion tax’ sting.
Chancellor Rachel Reeves announced that properties worth more than £2million would face a council tax surcharge in an attack on property owners most likely to ensnare those in London and the southeast.
But there are some little-known tricks you can use to quietly devalue your property in order to bring it under the threshold. And although some of the measures may seem extreme, property experts are warning that with tax rates so high homeowners could take strong action to escape them.
Below, we reveal the home features that can slash the largest amount off a property’s price tag.
From outdated décor to swapping a bath for a shower, here are the ways you could slash tens of thousands of pounds off the value of your home – just make sure you don’t want to sell up anytime soon.
What is the proposed mansion tax?
The high value council tax surcharge starts for homes valued between £2million and £2.5million – these homeowners will have a £2,500 bill will be slapped on to their regular council tax bill.
For properties valued at £2.5million to £3.5million a £3,500 bill will need to be paid while for homes at £3.5million to £5million, some £5,000 is due.
For the most expensive properties worth more than £5million, a £7,500 surcharge will be slapped on top of a family’s usual council tax bill.
Instead of the revenue being used for the local authority, like council tax, the money raised from the surcharge will instead go straight to the Treasury.
Homes worth more than £2million will be forced to pay a surcharge on top of their council tax thanks to Rachel Reeves’ Budget
It’s expected to raise just £400million a year from April 2028, when the tax starts to be levied. Plus, the Office for Budget Responsibility says this mansion tax will also cause a result in a lower take from other property taxes, including stamp duty and capital gains tax, as upmarket sales grind to a halt.
The reform is expected to cause an instant standstill in the higher end of the property market ahead of property’s being valued. Experts also warn it will create price ‘bunching’ around the property value bands as buyers look to limit their tax liability when they make their offers.
The Treasury has been scant on how it plans to determine which homes need to be levied with a surcharge. Council tax bands are very out of date, as valuations were completed in 1991.
Ms Reeves was said to be ordering a revaluation of homes in bands F, G and H homes in England. While no details were announced on this scheme in the Budget, the Treasury has said the valuation office will ‘conduct a targeted valuation exercise to identify properties above £2 million.
Plus, revaluations will be conducted every five years.
While the Government has not yet disclosed how the valuations will be done, they are likely to factor in components used to determine council tax bands, which include size, layout, character and location.
You may not be able to control the location of your property, for example, but the below features could change the character of your home and reduce its value.
It has said that while the levy won’t be charged until April 2028 – giving those who want to downsize a head start –valuations will be based on the 2026 valuation of a home.
Who will be affected?
Fewer than 1 per cent of properties in England are expected to be dragged into the mansion tax net, according to the Government.
Most of the homes which will be liable for the tax are in London and the southeast, according to Land Registry data on the prices of homes that have sold since January 2024.
During the last three decades, property price tags in some areas have soared, especially London and the southeast, which means homeowners who think they might escape unscathed will be dragged into the mansion levy.
As high proportions of these properties will be inner city, it means swathes of affected homeowners who are said to be in ‘mansions’ will actually be living in terraced homes or even flats in the capital rather than sprawling country estates.
And while Ms Reeves was reportedly forced to increase the threshold from an initial £1.5million to £2million, the levy is still expected to drag in pensioners and low-income families who bought their properties decades ago for a small sum but have benefited from soaring property prices in the years since.
A deferral scheme will consulted on in the new year so cash-poor owners don’t need to sell their homes simply to find enough cash to pay the levy.
Homeowners will be desperate to make any changes they can to their properties to bring it under the £2million threshold.
David Little, of Evelyn Partners, says: ‘To see this you only have to look at the story of the “window tax”. For over 150 years, until the mid-19th Century, an effort to levy a wealth tax involved judging the value properties according to the number of windows they had – even where large tenements had multiple occupants. So this led to many landlords and wealthy people bricking up windows to bring their property below the window tax threshold.
‘Bricked-up window-spaces gave birth to the term “daylight robbery”, and are still visible across London today.’
Here are the niftiest ways you can avoid the mansion tax – whether that’s by selling up or devaluing your property.
1. Downsize
It’s the simplest way to avoid paying this mansion tax – simply sell your expensive property and buy one that falls under the threshold.
It’s something Jennie Hancock, director of West Sussex buying agency Property Acquisitions, is expecting to see.
The one silver lining is that the tax won’t come into effect until 2028, which leaves a decent window for downsizers to make their move – and I expect many will, even if they have to take a hit on the price. Retirees on fixed incomes won’t want the burden of an additional annual bill they haven’t factored into their long-term plans.’
However, you may struggle to find buyers for your property if it is valued at more than the mansion tax threshold as movers will be looking for homes that fall under £2million to skip the surcharge.
So, as Ms Hancock suggests, you may have to be flexible with the price you want to achieve.
2. Allow your garden to overgrow – lose £164,000 (8.2 per cent)
Most of us get a little behind on garden upkeep every now and then. But next time your lawn and hedges become overgrown, let them continue to be unruly – even if it means your garden looks untidy.
That’s because an overgrown, unloved garden can knock money off a property value – and the damage can equate to as much as some £164,000 on a £2million home. That is according to figures crunched for Money Mail by online estate agency Yopa.
Fred Jones, chief executive at house-buying company Upstix, says: ‘If the garden is really overgrown it’s a sign of neglect and further home issues. It also means you can’t see if the wall in the garden is intact.
‘It will make buyers think, “they probably won’t have fixed the leaky roof”. It’s not just the issue itself but an indication that something else might be there which will take time, effort and money to fix.’
While it may be a good tool to avoid the mansion tax, consider giving it a spruce if you often host friends for garden parties and barbeques to save yourself the embarrassment.
An unruly garden may not be ideal to host people, but it could devalue your home ahead of a mansion tax
3. Let the clutter build up – lose £84,000 (4.2 per cent)
Rule number one of trying to sell a house is to make it look pristine – clear away the clutter and make sure all the odd jobs around the house are done well before accepting viewings.
But if you’re aiming to slash thousands of pounds from the value of your home to bring your property under a £2million threshold then simply let the clutter pile up.
Buying a home is an emotional experience so buyers may struggle to look past the mess when they are viewing.
And it’s often reflected in the price – expect some 4.2 per cent to be knocked off the value of your home if it is untidy or in a poor state of repair. That’s £84,000 on a £2million ‘mansion’, Yopa says.
4. Have an unsightly front door – lose £34,000 (1.7 per cent)
Your front door is a buyer’s first impression of your home – and the right one can add as much as £30,000 to an average property’s price tag, according to Yopa.
But if the door is unkept it can devalue your property by some 1.7 per cent.
It may seem bizarre for a door to hold so much bearing on a property price but it is the gateway to your home.
Mark Breffit, of estate agency Hamptons, says: ‘A front door is like a first date – it sets the tone for everything that follows, creating an instant emotional response.
‘A well-maintained, stylish front door can elevate a property’s kerb appeal and set the right expectation for what’s inside. I’ve seen countless viewings where something as simple as peeling paint or a loose handle has put off buyers.’
So if the paint is cracking or it is an untrendy colour (anything that clashes with your home’s overall aesthetic, according to experts), leave it alone to swipe some £34,000 off the property value.
5. Have an old swimming pool? Don’t update it – lose £392,000 (19.6 per cent)
A swimming pool may add a touch of glamour to your home and can boost its price by up to 20 per cent when properly maintained.
But one that is rarely used or isn’t in tip-top condition can decrease a property’s value by a chunky 19.6 per cent, according to data from Yopa. That’s £392,000 for these so-called ‘mansion’ properties.
It’s because buyers will need to factor in the cost of upgrading a slightly run down pool or removing it altogether when they make their offer.
Niall Robinson, market specialist and valuation expert at London-based agency Paramount Properties, says the hassle of sorting out an unkempt swimming pool is a major deterrent for buyers.
Plus, the cost of maintaining a pool may be a turn-off to buyers who will need to factor in around £650 annually for chemicals, up to £450 to fill it with water and as much as £250 for a professional monthly service for a standard sized pool – as well as higher energy bills to heat it.
6. Leave the 1990s décor intact instead of upgrading to modern features – lose £76,000 (3.8 per cent)
If Ms Reeves launches a mansion tax raid tomorrow, consider leaving alone the outdated décor you’ve been meaning to upgrade.
Poor style can wipe 3.8 per cent from a house value – £76,000 on a £2million property.
Outdated fittings and decoration can slash thousands of pounds from a house value
Buyers need to factor in the extra cost and effort of ripping out old carpets and wallpaper, which they don’t need to do if the property is already modern and sleek.
While it’s a thorn in the side of any seller, that old floral wallpaper or 1980s style carpet may work to your advantage if a mansion tax raid is launched by the Chancellor.
7. Swap the bath for a walk-in shower – lose £40,000 (2 per cent)
Baths fell out of favour decades ago for most households as busy professionals tend to favour showers to save time.
But despite this, homebuyers still love a traditional bath so removing it could actually dent your property’s price tag.
According to estate agents Winkworth, having a bath in a family home is almost engrained into the British psyche, whether families actually have a bath regularly or not.
Switch out your bath for a shower if you want to bring you under under the mansion tax cliff edge
It’s especially true if the bathroom is a family bathroom, compared to an ensuite or in a studio flat, experts say.
So one easy way to slash tens of thousands of pounds from your property value is to swap your bath for a modern walk-in shower. It could cut the price of your £2million home by some £40,000.
However, this switch could cost you anywhere from £1,000 to £5,000, according to tradesperson platform MyJobQuote. This may well cancel out any benefit you get from avoiding the mansion tax – worth £4,500 on average – for the first year.
Only consider this trick if you prefer showering to a bath anyway, as saving in tax may not be worth it if you miss those relaxing evening soaks.
8. Don’t ask next door to clean up their back garden – lose £220,000 (11 per cent)
It may seem unfair, but the poor upkeep of your neighbour’s property – which you can’t control – can wipe some £220,000 from your property’s price tag, according to Yopa.
While this is ordinarily a big issue for homeowners who are getting their property ready to go to market, it could pay dividends for those looking to bring their home under the £2million mark.
The market value of your home will be impacted by the property next door as buyers want to live in a well-kept area with lovely, considerate neighbours.
If their grass is overgrown, a mattress is strewn in the garden or there’s poor kerb appeal, then buyers may offer less for the property or demand could be reduced which could in turn lead to a price reduction.
Mr Jones says if there’s a poor neighbouring property, buyers will ask if that’s a sign of antisocial behaviour.
He says: ‘First impressions matter. Buyers will wonder if this is going to be a nuisance – and if they have loud dogs or music. They’ll wonder if this is this going to keep the children awake and if there will be legal dispute.’
Experts typically advise you speak to the neighbour politely as a first port of call in tidying up the property.
But if you’re looking to quickly slash tens of thousands of pounds from your home’s value then consider leaving the issue alone, as long as you are okay living next to an unruly garden and a house with poor kerb appeal.
9. Switch your manicured lawn for artificial grass – £106,000 (5.3 per cent)
They might be easy to maintain but artificial lawns can slash more than £100,000 from your home’s price tag.
That’s according to estate agents Benham and Reeves, which says fake grass can swipe some 5.3 per cent off a house price.
Marc von Grundherr, a director at Benham and Reeves, says: ‘Artificial lawns tend to divide opinion, but when it comes to property value, they generally do more harm than good.
Artificial grass is avoided by buyers, no matter how easy it is to maintain
‘A well-installed fake lawn might appeal to time-poor owners or landlords who want to minimise maintenance, but for most buyers – particularly those with an eco-conscious mindset – the preference remains firmly for natural grass.’
So while your garden may be your pride and joy, switch to artificial grass to bring your property value under £2million.
But it can be a pricey endeavour – for a 50 square metre lawn the mid-range turf alone will cost as much as £1,200. It may also take two days for the grass to be installed, which can cost anywhere from £600 to £1,200, according to Checkatrade.
A word of warning…
If you want to sell your home any time soon, think twice before taking any of these steps to devalue your property.
Many of these features are easy to fix, such as asking your neighbour to clear up their garden, or trimming back yours.
But some are more permanent decisions, like swapping out a bath in the family bathroom for a walk-in shower or ripping up your manicured lawn in favour of artificial grass – and letting a swimming pool fall completely into disrepair could land you with a large future bill.
If you are putting your home on the market within the next few months to a year, you will attract a higher price if you fix these issues before inviting buyers to look around.
However, buyers may also be more interested in your home if it sells below £2million, as it means they may not need to pay the mansion tax either when they move in. It may lead to a quicker sale.
And remember, you need to live with these features. If outdated décor isn’t what you had in mind for your dream home, you need to weigh up whether steering clear of the mansion tax is worth it.
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