Positive Shifts in the UK Mortgage Market: Why Now Could be the Right Time to Act
The UK mortgage market has been through a whirlwind over the last couple of years, with rising interest rates, inflationary pressure, and economic uncertainty keeping many would-be buyers and homeowners on the sidelines. But now, in 2025, the tide is beginning to turn and the outlook is becoming far more positive for anyone looking to buy a home, move up the ladder, or remortgage.
The UK mortgage market is experiencing a period of positive transformation, offering new opportunities for prospective homeowners and those looking to remortgage. Falling interest rates, relaxed affordability assessments, and supportive government initiatives are converging to create a more accessible and dynamic housing market.
Here’s what’s happening in the mortgage market right now, and why it could be the right time to act, with the right support by your side.
Interest Rates: The Winds Are Changing
One of the most promising developments for borrowers is the shift in interest rate expectations. After a period of successive increases, the Bank of England base rate appears to be reducing, currently sitting at 4.5% and more importantly, forecasts suggest that further cuts could be on the horizon.
Financial markets are now pricing in a potential drop in the base rate by the second half of the year, with some analysts predicting it could dip below 4.5% by early 2026. This has already started to filter through to mortgage rates. Fixed-rate mortgage deals have become more competitive in recent months, with many lenders cutting rates to attract new business.
This is good news for borrower, particularly for those coming off higher fixed rates or looking to get their foot on the property ladder. As rates begin to ease, monthly payments become more manageable, improving affordability for many households.
Lender Confidence is Returning
We’re also seeing lenders become more flexible in their criteria and more confident in lending decisions. Some major banks have relaxed affordability tests, meaning people can now borrow more relative to their income compared to last year. That’s especially helpful for first-time buyers and those looking to move to a bigger home.
Combined with stabilising house prices and increased housing supply, thanks to new government commitments to build more homes. This makes for a more balanced, buyer-friendly market than we’ve seen in a long time.
A Better Market for Remortgaging?
For the many homeowners whose fixed-rate deals are due to expire in 2025, there could be relief ahead. While rates won’t return to the ultra-low levels seen during the pandemic, the fact that it appears we’ve moved past the peak of the rate-hiking cycle means that the worst may now be behind us.
Those remortgaging in the coming months will find more options available, more flexibility from lenders, and more support in finding deals that suit their changing circumstances.
Market Growth and Positive Forecasts
The combination of lower interest rates, relaxed lending criteria, and government support is expected to invigorate the mortgage market. UK Finance projects that gross mortgage lending will reach £260 billion in 2025, an 11% increase from the previous year. Lending for house purchases is forecasted to total £148 billion, reflecting a 10% growth compared to 2024. External remortgaging is also projected to rise significantly to £76 billion, a 30% increase from 2024 levels. These figures indicate a robust and growing market, providing ample opportunities for both new buyers and those looking to refinance.
How Complete Mortgage Advice Can Help You Navigate This Market
Although conditions are improving, the mortgage market remains complex and that’s where expert help can make all the difference. At Complete Mortgage Advice, we specialise in guiding our clients through the mortgage maze with honest, tailored support.
Whether you’re a first-time buyer trying to understand how much you can borrow, a homeowner coming to the end of your current deal, or someone exploring buy-to-let opportunities, we take the time to understand your goals and match you with the most suitable mortgage solutions.
We work with a wide range of lenders, including some you won’t find on the high street—so we can find exclusive deals and options that meet your needs. And we don’t stop once your mortgage is approved. We’re here to support you through the entire journey, from your initial consultation to the day you get your keys and beyond.
Looking Ahead
The outlook for the UK mortgage market in 2025 is far more optimistic than it was even a few months ago. With falling interest rates, a growing choice of mortgage products, and improving affordability, it’s an exciting time for buyers and homeowners alike.
If you’ve been putting off your next move because of uncertainty, now could be the time to revisit your plans.
Get in touch today for expert guidance and see how we could help you! 📩💜
Tom Boulden
Mortgage Advisor
📞 01752 905011
📧 info@completemortgageadvice.co.uk
🌐 www.completemortgageadvice.co.uk
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