"Introducing Capital Gains Tax on main residences could have serious consequences for the housing market. When fewer homeowners are willing to sell, supply will naturally constrict, driving up competition and prices."
- Gerard Boon - Boon Brokers
UK homeowners are overwhelmingly opposed to proposed Capital Gains Tax (CGT) reforms on primary residences, warning that the changes would be unfair and damaging for all homebuyers, according to new research from Boon Brokers.
The survey examined public sentiment across the UK, exploring perceptions of fairness and potential consequences for homeowners. Under the current tax system, main residences are exempt from CGT. The proposed reforms would remove or reduce this exemption for higher-value primary homes, making a portion of any profit taxable. While exact details on thresholds, rates, and exemptions remain unconfirmed, the introduction of such reforms could significantly alter how homeownership is treated for tax purposes.
The research revealed widespread concern and anxiety among homeowners, with many saying the proposed reform would discourage property sales, add strain to ordinary homeowners, and unfairly penalise individuals who have already invested heavily in housing. One prevailing sentiment was that “homeowners feel they have already paid enough.”
Strong opposition across the UK
When asked, “Do you believe it is fair for the government to apply Capital Gains Tax to main residences that were previously exempt?” 73% of respondents said it would be unfair. The study also found that 97% disagreed that taxing primary homes is the fairest way to balance public spending, reflecting opposition across all demographics.
“This data shows a growing concern that additional taxation on primary residences could penalise those who have made long-term financial decisions based on the existing system,” noted Boon Brokers. Opposition was consistent across all regions, including the North, South, East and West of England, as well as Scotland and Wales.
The survey also examined how the proposed CGT changes might influence homeowner behaviour. 71% of respondents said the reforms would make them less likely to sell their main residence. This reluctance could constrain housing supply, worsening affordability for first-time buyers and younger households and potentially limiting social mobility.
Gerard Boon, managing director of Boon Brokers, explained, “Introducing Capital Gains Tax on main residences could have serious consequences for the housing market. When fewer homeowners are willing to sell, supply will naturally constrict, driving up competition and prices. This imbalance doesn’t just impact affordability; it risks stagnating the market and placing greater pressure across all levels of the housing sector.”
The resistance to selling was consistent across age groups. Among 18- to 24-year-olds, 76% said they would be less likely to sell, compared with 63% of those aged 25-44, 68% of those aged 45-54, and more than 80% of respondents aged 55 and over. The data indicates the reform would affect multiple generations, with older homeowners the most likely to postpone sales.
Political implications
The survey also explored voter sentiment, asking how the reforms might affect Labour’s chances of re-election. 78% of respondents said the proposed CGT would reduce Labour’s prospects, with 45% believing it would significantly reduce support and 33% saying it would slightly reduce support. Concern was consistent across regions and age groups.
When asked how the government should address public finances, 32% preferred reducing public spending, 22% suggested targeting wealth or high-income households, and 19% favoured introducing a wealth tax on very high-net-worth individuals. Another 16% advocated maintaining current exemptions and focusing on economic growth, while only 3% supported CGT on primary homes.
Boon Brokers concluded that homeowners are seeking fairer, less disruptive solutions. By focusing on spending cuts, targeted wealth measures, or economic growth, the government could address finances without burdening those already invested in housing.
