Published on 16 Dec 2025
This model relies on statistical analysis rather than observed sales. We are all used to the old Land Registry Index, but this new HPI model tends to produce higher pricing that does not take into account the human factor.
There will no doubt be litigation, not to seek to cut the annual mansion tax, but rather the valuation itself.
Why? Simply put, this is a government agency and the data is likely to be made available to HMRC, which may result in higher property inheritance tax appraisals, higher capital gains tax on transfer and/or higher taxes on offshore trusts holding UK assets. All of these will raise taxes.
With regards to law, the model-based valuations may be used in family courts or insolvency proceedings, for example. With regards to mortgage lenders, will they use their own valuations or the government model? What happens if the government model is different to a lender’s valuation in repossession hearings?
And if the government model is not used in these circumstances, might it be argued that it is not accurate enough? And if so, why will homeowners be forced to use it? Or will they have the option of paying thousands of pounds to obtain private valuations?
We understand that the government’s desired effect was to create more reliable house price information and a more reliable way to administer this tax. But we suspect that with so many assumptions made, the results derived may not hold true in a real-world, dynamic market. British statistician George Box noted that “all models are wrong, but some are useful” – in this case useful to the government, but maybe not so much to the homeowner.
As we move forward at least with some clarity, it is now more important than ever for sellers to work with an estate agent that is aware not only of the short game, but the long-game environment.
Charles Curran, managing director Maskells
Read the article in PropertyWeek