Capital Gains Tax: Why Now Might Not Be the Time to Sell Your Rental Property
Capital Gains Tax and the UK Property Market: Why Landlords Shouldn’t Sell Right Now
Thinking of selling your rental property in Hailsham or East Sussex? Here’s why now may not be the right time.
At Bates & Co Lettings, we work with landlords across Hailsham, Eastbourne, and Polegate, helping them make informed decisions about their property investments. With property prices falling, Capital Gains Tax rising, and rents at an all-time high, many landlords are asking: “Should I sell my buy-to-let property in 2025?”
In most cases, the smarter move is to keep renting it out—and here’s why.
UK House Prices Are Falling
The UK property market has slowed in 2025. With higher mortgage rates and fewer buyers, house prices in many areas—including East Sussex—have seen noticeable declines.
This means:
- You could be forced to accept a below-market offer.
- You might lose out on the long-term capital growth your property could still deliver.
Selling now could cost you tens of thousands—and that’s before tax.
What Landlords Need to Know About Capital Gains Tax in 2025
Capital Gains Tax (CGT) is one of the most searched tax terms by landlords in the UK this year—and for good reason. The government has made changes that significantly affect landlords.
How it Works:
When you sell a buy-to-let property, CGT is charged on the profit (gain) you make. Here's how it's calculated:
- Selling price minus purchase price
- Minus any allowable costs (e.g. stamp duty, legal fees, capital improvements)
- Minus your annual CGT allowance
Reduced CGT Allowance:
As of April 2024:
- The annual tax-free allowance has been slashed from £12,300 to just £3,000.
- The remaining gain is taxed at 18% for basic rate taxpayers and 28% for higher rate taxpayers.
Example:
Let’s say:
- You bought a rental in Eastbourne for £200,000.
- You're selling it for £270,000.
- After fees, your taxable gain is £67,000.
- If you're a higher-rate taxpayer, you’ll pay around £18,760 in CGT.
Add estate agent fees and solicitor costs, and your true net profit shrinks fast.
UK Rental Prices at an All-Time High
While the sales market is slowing, the UK rental market is booming. According to Rightmove and Zoopla, rents are higher than ever, and tenant demand in areas like Hailsham, Eastbourne, and Polegate has skyrocketed.
That means:
- You can increase your monthly rental income
- You’ll benefit from low void periods
- You can retain your asset and ride out the market dip
At Bates & Co, we help landlords maximise rent through:
- Expert property marketing
- Strategic rent reviews
- Full property management services and a Guaranteed Rent Scheme
Long-Term Investment, Not Short-Term Panic
Many landlords are worried about compliance or market fluctuations, but selling now locks in short-term losses. Rental property is still one of the most reliable long-term investments—especially when managed professionally.
By keeping your rental property, you benefit from:
- Passive monthly income
- Long-term capital appreciation
- Tax-deductible expenses and allowances
- Flexible exit options in a stronger future market
Need Lettings Advice in Hailsham or East Sussex?
Before you sell, get advice from your local property experts. At Bates & Co Lettings, we can help you:
- Assess your current rental yield
- Review potential rent increases
- Stay fully compliant with UK landlord laws
- Remove the stress of management
