News in Review

The Bank of England cut rates to 3.75%, signalling cautious easing as inflation pressures continue to recede Farmers gain relief as the government raises Inheritance Tax thresholds following industry backlash and sustained protests UK markets opened 2026 strongly, with Boxing Day footfall rising and the FTSE surpassing 10,000 

“We still think rates are on a gradual path downward” 

During the Monetary Policy Committee’s (MPC’s) final meeting of 2025 on 18 December, the members voted to reduce Bank Rate to 3.75%, though it was a close call. Five of the nine members voted to reduce the rate, while four wished to retain it at 4%. 

The reduction was widely expected following inflation data which showed a slowing to 3.2% in the year to November. While still well above the 2% target, the Bank of England (BoE) expects inflation to move towards target faster than previously outlined. Minutes of the latest MPC meeting state that, ‘the risk from greater inflation persistence has become somewhat less pronounced,’ but medium-term risks to inflation due to weaker demand are still present. Moving forward, it was highlighted that any potential further monetary policy easing will be dependent on the inflationary outlook.  

After the announcement, BoE Governor Andrew Bailey commented, “We still think rates are on a gradual path downward but with every cut we make, how much further we go becomes a closer call.”  

The first MPC meeting of 2026 is scheduled to conclude on 5 February.  

Changes to Inheritance Tax (IHT) for farmers 

On 23 December, the government issued a press release outlining an increase in the Agricultural and Business Property Reliefs threshold from £1m to £2.5m, with effect from April 2026. The U-turn comes on the back of protests by farmers, following the announcement in the Autumn Budget 2024 to impose a 20% tax on inherited agricultural assets worth more than £1m from April 2026, bringing an end to 100% tax relief. Environment Secretary Emma Reynolds commented on the change, “We have listened closely to farmers across the country and we are making changes to protect more ordinary family farms.” She continued, “It’s only right that larger estates contribute more, while we back the farms and trading businesses that are the backbone of Britain’s rural communities.” 

The release states that the change to the threshold will allow ‘spouses or civil partners to pass on up to £5m in qualifying agricultural or business assets between them before paying Inheritance Tax, on top of existing allowances.’  

President of the Country Land and Business Association believes the government’s change will “come as an enormous relief to thousands of family farms across the country who faced seeing their businesses taxed out of existence” However he did caution that while a positive step, it only “limits the damage – it doesn’t eradicate it entirely,” especially for families who own “enough expensive machinery and land… valued above the threshold” but who operate on narrow profit margins, making the tax burden still “unaffordable.” 

Spring Forecast date announced 

Just before the festive break, Rachel Reeves announced the date of the Spring Forecast – 3 March 2026. As usual with key fiscal events, the Chancellor has asked the Office for Budget Responsibility (OBR) to prepare an economic forecast for publication alongside the statement in early spring. This will provide an interim update on public finances and the economy, not a measure of the government’s performance versus the fiscal mandate. The government were keen to reiterate that, they are committed to delivering one major fiscal event each year – at the Budget, typically held in October or November, they say this approach provides businesses and families with ‘the stability and certainty they need,’ whilst also supporting the government’s agenda for growth.

Boxing Day footfall on the up 

Figures from MRI software, retail tech experts, show Boxing Day performance was robust, with footfall up 4.4% year-on-year, the strongest increase in over a decade. Footfall in retail parks was strongest, with an 8.8% uptick, high streets followed with a 3.6% increase and shopping centres 2.1%. An increase in footfall does not necessarily equate to an increase in consumer spending.  

FTSE pushes through 10,000 mark 

Following solid annual gains in 2025, where the FTSE 100 ended the year over 20% higher, the index passed through the historic 10,000 mark on the first day of trading in 2026 (2 January) but failed to close above it. However, on Monday the index closed above the 10,000 for the first time, on 10,004.57. 

Here to help 

Financial advice is key, so please do not hesitate to get in contact with any questions or concerns you may have. 

The value of investments can go down as well as up and you may not get back the full amount you invested. The past is not a guide to future performance and past performance may not necessarily be repeated. 

All details are correct at time of writing (7 January 2026) 

Looking ahead: A new year, a clear plan

As 2026 begins, thoughtful financial planning remains essential for navigating change and securing long-term goals. Reviewing investments, tax strategies and pensions ensures your financial plans stay aligned with changing circumstances. Now is the perfect time to take stock and start the year with a clear financial plan. 

We’d like to take a moment to thank you for your continued trust throughout the last year. It’s been a year marked by ongoing change and resilience – and your commitment to thoughtful financial planning has been central to navigating it successfully. 

Looking ahead, we’re here to help you plan, protect, and grow your wealth with clarity and purpose. Whether that means reviewing your investment strategy, optimising your tax position, revisiting pension arrangements, or preparing for key milestones, we’ll work with you to ensure your plans remain aligned with your goals and circumstances as they flex. 

As you set your priorities for the year ahead, now is the perfect time to take stock and start 2026 with a clear plan and peace of mind. We look forward to continuing to support you and your family in achieving the financial future to which you aspire. 

Wishing you a happy, healthy and prosperous New Year. 

The value of investments can go down as well as up and you may not get back the full amount you invested. The past is not a guide to future performance and past performance may not necessarily be repeated. Financial protection policies typically have no cash in value at any time and cover will cease at the end of the term. If premiums stop, then cover will lapse. 

Planning with purpose in 2026

Providing for family is the strongest motivator for UK adults when it comes to financial planning. Find a balance between what you value, what you need and what gives you a sense of purpose. Mental wellbeing plays a vital role in financial confidence – we’re here to help you define your financial purpose.   

As we welcome 2026, it’s the perfect time for a financial reset. A new year brings renewed focus and the chance to take stock – where are you on your financial journey, and how confident do you feel about the year ahead? A clear plan can help you face the months to come with purpose and peace of mind. 

What really drives financial decisions 

A recent study1 has revealed that personal values are the strongest motivators for UK adults when it comes to financial planning. The top three drivers are providing for family (44%), financial independence (43%) and security (31%). 

Among 25 to 34-year-olds, these motivators are even more pronounced, with 58% citing family security and 53% financial independence, making them one of the most financially goal-oriented generations. 

Understanding what truly motivates you can bring clarity to your decisions, ensuring your finances align with what matters most in your life. 

Finding your financial Ikigai 

The Japanese concept of Ikigai – meaning purpose or ‘reason for being’ – can also apply to money. Finding your financial Ikigai means identifying the balance between what you value, what you need and what gives you a sense of purpose. When your financial goals reflect your deeper motivations, planning feels less like a task and more like a path toward fulfilment and wellbeing. 

Hello 2026: A fresh financial start 

Mental wellbeing plays a vital role in financial confidence. Research1 shows many people are feeling the pressure, particularly 18 to 24-year-olds and 45 to 54-year-olds, who report the lowest levels of mental wellbeing. A clear, values-based financial plan can help reduce uncertainty and build reassurance. 

Whatever your goals – protecting your family, building independence, or securing your future – 2026 offers a chance to focus, plan and move forward with confidence. We’re here to help you define your financial purpose and make your goals a reality in 2026 and beyond. 

1Aviva, 2025 

The value of investments can go down as well as up and you may not get back the full amount you invested. The past is not a guide to future performance and past performance may not necessarily be repeated.  

It’s that time of year again – consider your end of tax year planning

Consider using ISA and pension allowances before they reset to maximise long-term, tax-efficient growth Reviewing CGT, dividend and gifting allowances now could reduce unnecessary tax liabilities Early planning helps protect wealth, improve cash flow and avoid rushed decisions before the tax year ends 

As the end of the 2025/26 tax year approaches, it’s the ideal time to ensure you’re making the most of tax-efficient opportunities before the new financial year begins on 6 April 2026. Here’s a reminder of some of the main tax planning opportunities: 

Your Individual Savings Account (ISA) 

The ISA allowance is £20,000 for the 2025/26 tax year. You can put all £20,000 into a Cash ISA (until the allowance is cut to £12,000 for under 65s in 2027), or invest the whole amount into a Stocks and Shares ISA. You can also mix and match as long as the combined amount doesn’t exceed your annual ISA allowance. Junior ISAs work in the same way, but the maximum annual investment is £9,000 per child. 

Pensions 

The Annual Allowance is currently £60,000. An individual can’t use the full £60,000 Annual Allowance where ‘relevant UK earnings’ are less than £60,000, although your employer still could. You may be able to carry forward unused allowances from the past three years, provided you were a pension scheme member during those years. For every £2 of adjusted income (total taxable income including all pension contributions) over £260,000, an individual’s Annual Allowance is reduced by £1 until the minimum Annual Allowance of £10,000 is reached. 

If you have children under 18, a spouse who doesn’t work, or who isn’t earning enough to pay Income Tax, you can invest into a pension for each of them. The maximum annual contribution you can currently make is £2,880 which, with tax relief, amounts to £3,600 a year. 

Inheritance Tax (IHT) 

IHT receipts show no signs of slowing, with recent HM Revenue & Customs data revealing continued year-on-year growth. Between April and September 2025, IHT receipts totalled £4.4bn, around £100m more than during the same period in 2024, representing a 2.3% increase. If the current pace continues, total receipts for the 2025/26 tax year could reach approximately £8.8bn, setting yet another record. Looking ahead, the Office for Budget Responsibility (OBR) forecasts that IHT revenues could potentially rise to £14bn by the end of the decade. 

Remember – you can make gifts worth up to £3,000 in each tax year. These gifts will be exempt from IHT on your death, even if you die within seven years. You can carry forward any unused part of the £3,000 exemption to the following year but if you don’t use it in that year, the exemption will expire. Certain gifts don’t use up this annual exemption, however, there is still no IHT due on them e.g. wedding gifts of up to £5,000 for a child, £2,500 for a grandchild (or great grandchild) and £1,000 to anyone else. Individual gifts worth up to £250 per recipient per tax year are also IHT free. Under current HMRC rules, gifts outside the above categories normally cease to count for IHT purposes upon the donor’s death if they live for at least seven years after making the gift – known as Potentially Exempt Transfers (PETs).  

Capital Gains Tax (CGT)  

If you have assets to dispose of or transfer, act now to ensure you take full advantage of this year’s CGT exemption. The annual CGT exemption is currently £3,000.  

If your assets are owned jointly with another person, you can use both allowances, which can effectively double the amount you can make before CGT is due. 

If you are married or in a civil partnership, you are free to transfer assets to each other without any CGT being charged. 

Using your Dividend Allowance 

The dividend allowance is £500 for the current tax year. This is lower than in previous tax years and is set to remain at £500 for 2026/27. 

From April 2026, Dividend Tax rates are increasing – the basic rate rises from 8.75% to 10.75%, the higher rate rises from 33.75% to 35.75%, and the additional rate remains at 39.35%.  This change only affects dividends outside tax-protected exempt accounts such as ISAs or pensions. Dividends held within these are fully tax-free, allowing investors to grow their savings without additional liability. 

VCTs and EISs 

Venture Capital Trusts (VCTs) and Enterprise Investment Schemes (EISs) offer many attractive tax benefits to experienced investors. While the existing 30% rate of Income Tax relief on qualifying VCT investments reduces to 20% in April 2026, on the plus side, dividends received on these investments remain tax free. 

You’ve still got time – but don’t leave it to the last minute! Sensible tax planning can help to reduce the amount of tax you pay and safeguard your wealth for the future. We can help – please get in touch. 

Please note that this article is intended for educational purposes only and should not be taken as investment advice. Tax rules are subject to change and taxation will vary depending on individual circumstances. The value of investments can go down as well as up and you could get back less than you invested. Investment in funds will not be suitable for everybody and you should make yourself aware of the risks before investing and if you are unsure, you should seek professional advice. 

Economic Review December 2025

“We still think rates are on a gradual path downward… how much further we go becomes a closer call” The BoE Governor recently warned about the impact AI could exert on employment ONS statistics show retail sales volumes fell 0.1% in November, below analysts’ expectations 

Pace of rate cuts could slow further 

While the latest set of consumer price statistics did show inflation now sitting at an eight-month low, after cutting interest rates to their lowest level in almost three years, the Bank of England (BoE) warned further reductions were likely to become a ‘closer call.’ 

Data published last month by the Office for National Statistics (ONS) revealed that the annual headline CPI rate of inflation fell to 3.2% in November. This reading was below all economists’ predictions in a Reuters poll, with the consensus suggesting the rate would only dip marginally from October’s figure of 3.6% to 3.5%.  

ONS said that lower food prices were a key driver behind November’s fall, with notable decreases seen in the cost of cakes, biscuits and breakfast cereals. Heavier Black Friday discounts compared to last year, particularly in the clothing and footwear sector, also helped drive the inflation rate lower.  

November’s CPI data enhanced hopes that inflation has now peaked as well as strengthening the case for an immediate interest rate cut; and the BoE’s Monetary Policy Committee (MPC) duly obliged when announcing the decision of its latest deliberations a day after the consumer price data had been released.  

However, as expected, the decision was a tight call with the nine-member committee only voting by a 5-4 majority to reduce rates by 0.25 percentage points, taking Bank Rate down to 3.75%. Additionally, despite acknowledging that the risk from ‘greater inflation persistence’ has become ‘somewhat less pronounced,’ the minutes to the meeting did suggest that the already gradual pace of monetary easing may be about to slow further. 

Commenting after announcing the MPC’s decision, BoE Governor Andrew Bailey reiterated this latter point saying, “We still think rates are on a gradual path downward but with every cut we make, how much further we go becomes a closer call.”  

Survey reports modest upturn in growth  

Although gross domestic product (GDP) figures released last month showed the UK economy unexpectedly contracted in October, more recent survey evidence does point to a potential return to growth at the end of last year. 

Official GDP statistics published by ONS revealed that UK output declined by 0.1% in October, following a similar-sized fall in September and zero growth in August. Overall, this resulted in the economy shrinking by 0.1% across the whole of the August-to-October period. 

October’s decline surprised economists who had typically been expecting a 0.1% rise. The weaker-than-anticipated figure was partly due to manufacturing output failing to recover as had been hoped, as repercussions from the Jaguar Land Rover cyber-attack continued to affect car production in October. Additionally, analysts suggested that uncertainty ahead of the Chancellor’s Budget had affected growth, negatively impacting both consumer and business spending levels. 

Data from the latest S&P Global UK Purchasing Managers’ Index (PMI), however, suggests businesses do now appear to be emerging from months of Budget speculation and fears of tax increases, with the survey’s preliminary headline growth indicator rising to 52.1 in December. This reading was up from 51.2 in November and above all forecasts submitted in a Reuters poll of economists.  

Commenting on the findings, S&P Global Market Intelligence’s Chief Business Economist Chris Williamson said December’s data brought “welcome news on faster economic growth” at the end of 2025, with firms buoyed by “the post-Budget lifting of uncertainty.” The PMI data, he said, was consistent with GDP growth of 0.2% in December and 0.1% across the fourth quarter as a whole, although he did add a note of caution, saying that growth was still dependent on technology and financial services activity, with “many other parts of the economy struggling to grow or in decline.” 

Markets  

Although major global indices closed 2025 higher year-on-year, trading at month end was mixed, with many markets closing lower on the last day of the year.  

On home shores, the blue-chip FTSE 100 closed the year on 9,931.38 to register an annual increase of over 21%, its strongest annual percentage increase since 2009. The mid cap FTSE 250 ended the year over 8.9% higher on 22,470.38 and the FTSE AIM rose over 6.4% to close the year on 766.39. Despite periods of geopolitical and macroeconomic uncertainty, UK equities were supported by gains across several heavyweight sectors. 

In the US, the tech-heavy NASDAQ climbed around 20% in the year to close on 23,241.99, while the Dow Jones closed up around 13% on 48,063.29. Despite global tariff uncertainty, a government shutdown and concerns over an AI bubble, robust corporate earnings, interest rate cuts and continued AI enthusiasm provided support.  

On the continent the Euro Stoxx 50 closed the year over 18% higher on 5,791.41. In Japan, the Nikkei 225 ended the year on 50,339.48, gaining over 26% in 2025. 

On the foreign exchanges, the euro closed the year at €1.14 against sterling. The US dollar closed at $1.34 against sterling and at $1.17 against the euro.  

Gold closed the year trading around $4,337 a troy ounce, an annual gain of over 60%. One of the strongest performing assets of the year. Brent Crude closed the year at around $61 a barrel, recording an annual loss of over 18%, as global surplus pressures markets. 

Governor warns AI likely to displace jobs 

The latest batch of labour market statistics has provided further evidence of a weakening jobs market, while the BoE Governor recently warned about the impact artificial intelligence (AI) could exert on employment. 

Figures released by ONS last month showed the UK unemployment rate rose to 5.1% in the August-to-October period; this represents the highest figure since the start of 2021. The data also highlighted the impact on younger workers, with the number of unemployed 18 to 24-year-olds increasing by 85,000 in the three months to October, the largest rise on this metric since November 2022. 

The release also revealed a further fall in employee numbers, with estimates suggesting the total number of payrolled employees fell by 38,000 in November following a drop of 22,000 in October. Data from S&P Global’s UK PMI also reported further cutbacks to staffing numbers in December with job losses reported to be ‘worryingly widespread.’ 

Last month also saw the Governor of the BoE warn that widespread adoption of AI is likely to displace people from jobs in a similar manner as during the Industrial Revolution. Mr Bailey also highlighted a specific issue for younger professionals who could find it difficult to secure entry-level roles due to AI. 

Retail trading conditions remain tough 

Official retail sales figures revealed an unexpected dip in sales volumes during November, while more recent survey data shows the retail environment remains challenging despite some improvement in consumer morale. 

ONS statistics released last month showed retail sales volumes fell by 0.1% in November; this was below analysts’ expectations, with a Reuters poll predicting a 0.4% rise. ONS noted that supermarket sales fell for a fourth consecutive month, while retailer discounts across November failed to boost Black Friday spending by as much as in some recent years. 

Evidence from the latest CBI Distributive Trades Survey also suggests retailers endured ‘softer trading conditions’ in the run-up to Christmas. Additionally, the CBI said retailers were not anticipating ‘any relief in the new year,’ with sales expectations deteriorating to their weakest level in over four years.  

December’s GfK Consumer Confidence index did offer retailers a glimmer of hope, with the long-running survey’s headline sentiment figure edging up to its joint-highest level of the year. GfK Director Neil Bellamy, however, acknowledged that confidence remains subdued describing consumers as “a family on a festive winter hike, crossing a boggy field – plodding along stoically, getting stuck in the mud and hoping that easier conditions are not far off.”  

All details are correct at the time of writing (02 January 2026) 

The value of investments can go down as well as up and you may not get back the full amount you invested. The past is not a guide to future performance and past performance may not necessarily be repeated. 

It is important to take professional advice before making any decision relating to your personal finances. Information within this document is based on our current understanding and can be subject to change without notice and the accuracy and completeness of the information cannot be guaranteed. It does not provide individual tailored investment advice and is for information only. We cannot assume legal liability for any errors or omissions it might contain. No part of this document may be reproduced in any manner without prior permission. 

FTBs looking to buy in cities

First-time buyers increasingly prefer city living, reversing the pandemic’s ‘race for space’ Dundee, Edinburgh and Doncaster show the largest rises in FTB city enquiries London demand has dipped, highlighting the impact of high house prices on affordability 

More FTBs are setting their sights on city living, new data reveals1. 

The analysis compared FTB enquiries between January and May 2025 with the same period in 2015. Over that time, the number of FTBs wanting to move to cities increased by 16%. This is yet more proof that the pandemic’s ‘race for space’ is being reversed, as more buyers continue to be attracted to urban areas. 

Some cities have seen particularly high increases in demand. Dundee experienced the biggest leap, with enquiries going up by an impressive 176%. Edinburgh followed with an increase of 91%, while demand in Doncaster rose by 74%. 

Meanwhile, London appears to have lost some of its appeal. High house prices have likely deterred FTBs, as demand has dropped by 7% in the last ten years. 

Looking to get onto the property ladder? City dweller or rural retreat – get in touch for advice. 

1Rightmove, 2025 

As a mortgage is secured against your home or property, it could be repossessed if you do not keep up mortgage repayments. 

Residential Property Review – December 2025

Rising taxes on rental income may squeeze buy-to-let yields and prompt some landlords to reassess investment strategies The Renters’ Rights Act marks a major shift toward periodic tenancies, limiting rent increases and strengthening tenant protections Housing happiness is closely linked to community, safety and environment, with smaller towns outperforming many larger cities 

Budget changes reshape the housing market 

November’s Budget introduced several housing-related measures that could have lasting implications across the property market. 

Landlords are set to face increased tax pressure. From April 2027, Income Tax on rental income will rise by two percentage points, lifting rates to 22% for basic, 42% for higher and 47% for additional-rate taxpayers. This is likely to reduce net rental yields for many buy-to-let investors at a time when costs are already elevated. 

First-time buyers will also see change ahead, as the government plans to replace the Lifetime ISA. A consultation is expected in early 2026, with the aim of launching a simpler savings product to support home ownership. 

Meanwhile, a new High Value Council Tax Surcharge will apply from April 2028 to homes worth £2m or more. Although affecting only around 0.5% of properties, mainly in London and the South East, it may influence wider market behaviour. 

Tenancy reforms under the Renters’ Rights Act 

The government has confirmed that the first phase of the new Renters’ Rights Act will come into force in May 2026.  

The initial phase of the rollout will relate solely to tenancy reform, while other measures will take effect in two subsequent stages. From 1 May 2026, all fixed term tenancies will automatically convert to periodic tenancies, meaning tenancy agreements will no longer have a set end date. Tenants will be required to provide two months’ notice if they wish to leave a property. Meanwhile, landlords will no longer be able to serve Section 21 notices; instead, they will need to provide a valid reason when evicting tenants. 

In addition, landlords will only be able to raise rent once a year and, when doing so, they must provide at least two months’ notice. Renters will have the right to challenge the increase – if they do, landlords will be prohibited from evicting tenants in response.   

Great Britain’s happiest places to live  

Rightmove has released its annual Happy at Home Index, revealing the happiest places to live in Great Britain.   

This year, Skipton in North Yorkshire was awarded the top spot, with residents praising the market town’s access to nature and green spaces, proximity to essential services and the friendliness of the locals. London was home to some top-performing areas, with Richmond upon Thames and Camden in second and third place respectively. Harrogate, Woodbridge and Altrincham also feature in the top 10, along with Stirling in Scotland.  

Rightmove surveyed residents from over 200 locations and found that one of the key drivers of happiness is a sense of belonging. A town’s safety and physical environment also play a significant part in residents’ happiness. Overall, the survey found that those living in the South West are most content with where they live, while residents of the East Midlands are least happy.  

All details are correct at the time of writing (17 December 2025) 

The value of investments can go down as well as up and you may not get back the full amount you invested. The past is not a guide to future performance and past performance may not necessarily be repeated.  

It is important to take professional advice before making any decision relating to your personal finances. Information within this document is based on our current understanding and can be subject to change without notice and the accuracy and completeness of the information cannot be guaranteed. It does not provide individual tailored investment advice and is for information only. We cannot assume legal liability for any errors or omissions it might contain. No part of this document may be reproduced in any manner without prior permission. 

Commercial Property Review – December 2025

Business rate reforms aim to support smaller retail assets but may unintentionally impact high-value offices and logistics buildings Regional office rents reached record growth as ESG-compliant, prime stock remains scarce across major UK cities Investor confidence strengthened in the West End, while occupiers increasingly favour flexible, fully fitted office space 

Business rate changes announced in Budget 

In the Autumn Budget 2025, the Chancellor announced changes to the business rates system, which have been met with mixed responses across the industry. 

From April 2026, eligible retail, hospitality and leisure (RHL) properties valued below £500,000 will benefit from lower tax rates – their standard multiplier will drop by 5p. To offset these reduced rates, properties valued at £500,000 or higher will see a 2.8p increase in the standard multiplier. The intention behind the increased rates was to target online retailers with large warehouses; however, some industry experts have expressed concern that other businesses will be affected too.  

Ion Fletcher at the British Property Federation commented, “This is not, as the Chancellor suggested, a de facto tax on online retailers, it will hit all businesses in larger, high value buildings including manufacturing, life sciences and logistics businesses in warehouses, as well as financial and professional services based in modern office space.” 

Regional offices see rapid prime rental growth 

Prime rents in the UK’s regional office markets increased at a record pace this year, a report has found. 

The data from Lambert Smith Hampton (LSH) shows that, in the 15 key regional office markets, prime rents are set to have risen by 8.2% in 2025. Growth is even stronger in the ‘Big Six’ markets (Birmingham, Bristol, Edinburgh, Glasgow, Leeds and Manchester), as prime rents are on track to have increased by 10.2% in 2025. In the first three quarters of the year, Leeds was the regional city that saw the strongest growth, with prime rents rising by 18%.   

LSH attributed the record growth rates to increased demand for state-of-the-art offices that are ESG-friendly. But these top-quality spaces are currently relatively low in supply, so rents have increased significantly. At the moment, prime offices account for only 5% of total supply in the regional markets, which is down from 9% in 2023.  

West End investment market update 

Data from Savills indicates that October was a positive month for the West End investment market. 

In October, investment in the West End market generated £437m – there were seven transactions in total, two of which were over £100m. This brings the number of £100m+ transactions this year-to-date (YTD) to nine, with a combined value of £2.2bn.  

Overall, the cumulative value of West End investments this YTD is £4.3bn, meaning transactions above £100m represented over half of this year’s sales. Institutional investors accounted for 71% of this year’s transactions above £100m, highlighting that this group is targeting higher-value assets. The largest West End transaction of the YTD was the sale of 1 Newman Yard, W1 – the 121,252 sq. ft property was purchased by Royal London in October for £250m. 

Looking ahead, Savills forecasts that total West End sales could reach £5.5bn by the end of 2025, notably higher than last year’s total of £4.4bn.  

Increased demand for ‘let-ready’ offices in Glasgow 

Research from Knight Frank shows that ‘let-ready’ office space is in high demand in Glasgow.  

The report found that, in Q3, about 75% of office take-up in Glasgow was for fully fitted premises. During that period, 86% of deals were for offices under 4,000 sq. ft, indicating that the preference for ‘let-ready’ accommodation is a particular priority among occupiers of smaller spaces. Simon Capaldi, office agency partner at Knight Frank Glasgow noted that, in response to this demand, “an increasing number of landlords are looking to enhance their product offering within their buildings beyond the traditional model.” For example, some commercial landlords offer fully furnished offices so tenants can move straight in.    

Overall, Glasgow’s office market should end 2025 on a positive note – despite seeing a slower Q3, the city is on track to record the highest level of office take-up since 2021.  

All details are correct at the time of writing (17 December 2025) 

The value of investments can go down as well as up and you may not get back the full amount you invested. The past is not a guide to future performance and past performance may not necessarily be repeated.  

It is important to take professional advice before making any decision relating to your personal finances. Information within this document is based on our current understanding and can be subject to change without notice and the accuracy and completeness of the information cannot be guaranteed. It does not provide individual tailored investment advice and is for information only. We cannot assume legal liability for any errors or omissions it might contain. No part of this document may be reproduced in any manner without prior permission 

News in Review

UK GDP contracted unexpectedly in October, reflecting production declines, construction weakness and businesses delaying decisions pre-BudgetBudget measures may ease inflation from April 2026, while economists anticipate a Bank Rate cut to support growth Mortgage lending surged in Q3, with higher loan-to-value borrowing reaching levels last seen before the financial crisis 

“We are determined to defy forecasts on growth” 

The latest figures from the Office for National Statistics (ONS) show that the UK economy shrank in October, contrary to expectations. Economists had anticipated that UK GDP would grow by 0.1% in the three months to October, but the data shows it contracted by 0.1%.  

The slowdown in GDP growth was partly driven by a 0.5% decline in the production sector. This was due to a 17.7% decrease in car output following the cyber-attack at Jaguar Land Rover in late August. The disruption had a knock-on effect across the manufacturing supply chain and the retail trade in motor vehicles. Construction output also decreased by 0.3% in the three months to October, while the services sector did not show any growth. ONS partly attributed this weakened performance to uncertainty surrounding the Budget – it noted that ‘businesses across the production, construction and services sectors reported that they, or their customers, were waiting for the outcome’ of the Chancellor’s announcement.  

Commenting on the figures, a spokesperson for the Treasury said, “We are determined to defy the forecasts on growth and create good jobs, so everyone is better off, while also helping us invest in better public services.”  

Budget measures could slow inflation 

A Deputy Governor at the Bank of England (BoE) has suggested that the measures announced in the Budget could help to slow inflation in 2026. Clare Lombardelli told the Commons’ Treasury Committee last week that lower energy bills, fuel duty caps and the freeze on rail fares could slow the rate of price increases. The Office for Budget Responsibility (OBR) has forecast that the Chancellor’s Budget could reduce inflation by 0.4%, with Lombardelli advising that any shift will be seen from April 2026.  

Final MPC meeting of the year  

The Monetary Policy Committee’s (MPC’s) final meeting of 2025 takes place this Thursday 18 December. At its last meeting in November, the MPC voted to maintain Bank Rate at 4% for the second time in a row. At the time, Governor Andrew Bailey commented that the Committee was proceeding with caution due to elevated inflation. Since then, new ONS data showed that inflation fell slightly in October, marking the first decline since May. Considering this, most economists expect that the MPC will vote to cut Bank Rate this week from 4% to 3.75%. Also, committee members may be encouraged to make a cut to support economic growth, following the unexpected news that the UK economy shrank in October.  

Fed cuts rates despite uncertainty 

Across the pond, interest rate cuts are also in the news. The US Federal Reserve reduced its key overnight borrowing rate by 0.25% last week, putting it in a range between 3.5% – 3.75%. This is the lowest level in three years, but not all policymakers were in support of the decision. The central bank is under pressure to balance a slowing job market with rising inflation, which reached 3% in September, for the first time since January. However, boosting the labour market seemed to take priority in the latest vote, as the nation continues to feel the effects of the longest-ever government shutdown, which ended in November.  

Spike in mortgage lending in Q3 

In promising news for the property market, quarter three of this year recorded the sharpest quarterly jump in mortgage lending in five years. According to new BoE data, the value of gross mortgage advances rose by 36.9% to £80.4bn, marking the largest quarterly increase since Q3 2020. Meanwhile, the outstanding value of all residential mortgages increased by 0.9% when compared with Q2, reaching £1,733.7bn. The data showed that more buyers are continuing to take out mortgages with higher loan-to-value (LTV) ratios – the share of mortgage advances with LTVs exceeding 90% rose quarterly by 0.3 percentage points to 7.4%. This is the highest share since Q2 2008 and 0.8 percentage points higher than last year.  

Here to help 

Financial advice is key, so please do not hesitate to get in contact with any questions or concerns you may have. 

The value of investments can go down as well as up and you may not get back the full amount you invested. The past is not a guide to future performance and past performance may not necessarily be repeated. 

All details are correct at time of writing (17 December 2025) 

Personal pension age change delays access to savings

From April 2028, pension access rises to 57, impacting those born after April 1973 Early pension access will be limited to those with ill health or protected pension ages Many are worried about the upcoming change, so seek advice and review your plans 

A two-year increase in the normal minimum pension age could impact retirement planning for thousands of people. Under current rules, personal and workplace pension funds can be accessed from the age of 55. From 6 April 2028, the age limit will rise to 57 years. 

This means if you were born on or after 6 April 1973, you will have to wait until after your 57th birthday to access pension-based savings. If you were planning to access these funds before 2030, then you might want to rethink your draw down strategy. 

There are still some circumstances when you can access funds earlier than the normal minimum pension age, for example if you are suffering from ill health or have a protected pension age. Anyone born before 6 April 1971 will not be impacted by the change. 

Funding a happy retirement  

The pension freedoms that were introduced in 2015 meant the over-55s could dip into their personal pension pots even while they were still working. As a result, the government is concerned that older adults will not have sufficient resources to provide for later life. 

A recent study found that the happiest retirees have an income of around £1,700 per month, which equates to a pension pot of around £221,000 at retirement age1. However, 22% of retirees in the UK are living on less than £1,000 a month, which is below the recommended minimum for covering essential costs later in life. 

With 63% of 50-year-old workers worried about the upcoming increase to the normal minimum pension age2, don’t suffer in silence. We can advise on what the changes mean for your retirement planning. 

1L&G, 2025, 2Censuswide Survey, 2023 

The value of investments can go down as well as up and you may not get back the full amount you invested. The past is not a guide to future performance and past performance may not necessarily be repeated. The Financial Conduct Authority (FCA) does not regulate Will writing, tax and trust advice and certain forms of estate planning.