The UK mortgage market is set to experience a “booming” period in 2026, according to industry analysts and brokers. Data from financial information service Moneyfacts shows that the choice of mortgage products has reached its highest level in 18 years, with first-time buyers also benefiting from lenders’ more flexible requirements.
Mortgage rates have fallen over the past year, but wider global and economic uncertainty still has the potential to derail any further improvements. However, more than eight in 10 mortgage customers have fixed-rate deals, which provide stability as the interest rate does not change until the deal expires, usually after two or five years.
“Expectations are high for a booming market in 2026. Mortgage rates are lower year-on-year, and the choice of deals is abundant,” said Rachel Springall, finance expert at Moneyfacts. “First-time buyers are not being left behind by this progress.”
While buying a property remains a significant financial stretch for many first-time buyers, rising wages mean that mortgage costs as a share of income are at their lowest for a few years. Regulators have also allowed lenders to be more flexible with mortgage affordability, leading to the availability of more innovative products to help people purchase their first home.
“These include allowing borrowing up to six times your income, where affordability allows,” said Jo Jingree, director of broker Mortgage Confidence. “Some lenders were offering low, or no, deposit mortgages, and family and friends were able to support borrowers through new, so-called joint borrower, sole proprietor mortgages.”
Industry predictions made before Christmas suggested that sales could fall over the year as a whole compared to 2025. However, mortgage brokers have suggested there is some pent-up demand among potential buyers who were waiting for the Budget and the festive period to be over before making firm plans to move.
Aaron Strutt, from broker Trinity Financial, said 1.8 million borrowers were coming to the end of their fixed rates, and competition between lenders to issue more mortgages was likely to be even stronger this year. “We can expect to see some more criteria easing and hopefully even cheaper fixed rates,” he said.
Housing commentators have pointed to the relative stability of prices in recent times, with the UK housing market moving on from the “red-hot” period for sellers in the aftermath of COVID-19. “There are distinct differences as always as you move to higher prices and from parish to parish, but in general the UK housing market remains healthy and largely predictable,” said buying agent Henry Pryor.
