As we move into 2025, the property industry is poised for a surge in acquisition activity, driven by impending changes to Business Asset Disposal Relief (BADR) announced in the recent Autumn Budget. Our research reveals that while overall business acquisitions across the UK have seen a decline in recent years, the property sector is bucking this trend, with a significant increase in activity expected throughout the year.
A Decline in Business Acquisitions Across the UK
Between 2020 and 2024, the UK experienced a steady decline in business acquisition activity. According to the latest data from the Office of National Statistics :
- Domestic acquisitions: Declined by -12% in 2023, with 860 transactions recorded.
- Inward acquisitions: Dropped by -16% in 2024.
- Outward acquisitions: Fell by -5% in 2024.
These figures highlight a challenging market for business transactions. However, the property sector is showing resilience and an opposing trend in 2024, primarily influenced by changes to the BADR tax rate.
The BADR Effect on Property Market Acquisitions
From April 2025, the BADR tax rate is set to increase from its current level of 10% to 14%, with a further hike to 18% scheduled for April 2026. This phased increase in capital gains tax is creating a window of opportunity for property business owners planning to sell.
Until April 2025, sellers can still take advantage of the 10% rate, driving urgency among estate and letting agency owners to act quickly while the tax environment remains favourable.
Lucy Noonan, Founder and CEO of Atomic Consultancy, comments:
“While the past couple of years have been challenging for the UK as a whole, we’ve not seen this play out when it comes specifically to acquisitions within the property industry.
In fact, there remains a significantly strong appetite to exit amongst estate agency owners and an equally keen landscape of buyers. In just three short years since launch, we’ve completed 97 deals and had to bolster our workforce in order to facilitate this high demand, and we’re currently seeing no sign that this momentum is slowing.
Moving forward, we fully expect this level of activity to intensify before BADR changes kick in, with the biggest hikes not arriving for another 18 months.
We’re currently encouraging anyone who is planning an exit strategy in the next three years to bring those plans forward in order to beat the BADR changes.”
Why look to buy or sell an estate or lettings agency now?
The looming changes to BADR are creating a sense of urgency for property business owners considering their exit strategy. Acting now allows sellers to:
- Lock in the current 10% BADR rate.
- Avoid the financial impact of higher capital gains tax rates.
- Capitalise on a strong buyer market with sustained demand for acquisitions in the property sector.
At Atomic Consultancy, we specialise in guiding estate and letting agency owners through the complex acquisition process, offering practical, honest, and affordable support to maximise outcomes.
Plan Your Exit Strategy
If you’re considering selling your estate or letting agency in the next three years, now is the time to act. Beat the upcoming BADR changes and secure the best deal in a favourable tax environment.
We’d love to help you by discussing your options confidentially or by providing a no-obligation quote, please get in touch today.
Data sources UK business acquisition data overview sourced from the Office for National Statistics, Domestic acquisition data sourced from the Office for National Statistics, Outward acquisition data sourced from the Office for National Statistics, Inward acquisition data sourced from the Office for National Statistics
