There are growing signs of renewed confidence in the UK housing market, with mortgage rates expected to fall in the coming weeks, according to a newly published report from Moneyfacts. For anyone considering buying or selling a house in 2025 or 2026, the outlook is becoming increasingly positive.
The report highlights that the number of mortgage products available is at its highest level in 18 years, while lenders are also easing criteria for first-time buyers. Combined with recent base rate reductions, this has left the property industry “quietly confident” about the year ahead.
Moneyfacts reports that borrower choice has expanded significantly, giving buyers access to more competitive mortgage deals. This increase in product availability, alongside falling interest rates, is expected to encourage buyers back into the housing market, particularly those who paused plans during the period of economic and political uncertainty.
Harry Chennells, Associate and Valuer at Cheffins in Cambridge comments on the findings in the Moneyfacts report, as well as giving his view on the property market for 2026.
“Speaking with our advisors, this is very much in line with the conversations they’ve had with borrowers at the start of this year. The combination of rates falling year-on-year, coupled with the number of deals available on the market will be attractive and ought to help encourage buyers back into the market. The sentiment in the property industry is currently quietly confident.
From a macroeconomic perspective, we expect the Bank of England to continue a gradual downward adjustment of the base rate over the course of next year. With inflation easing (most recently reported at 3.2%), the decision to hold rates previously appears justified, and once seasonal inflationary pressures subside, there should be further scope for steady reductions. This is likely to feed through to improved mortgage pricing and, crucially, renewed buyer confidence. This, alongside the growth in the number of products on the market and rising wages, should hopefully also help first-time buyers to make the first step onto the property ladder.
In Cambridge, borrowing costs play a particularly important role given the city’s higher-than-average price points. Even modest improvements in mortgage rates tend to have a disproportionate impact on affordability and sentiment, especially for family houses and prime city homes. We also anticipate a better balance between supply and demand. Many potential sellers delayed moves during the recent period of political uncertainty, but as confidence improves, more stock should return to the market. Demand looks also set to remain resilient in the region, particularly for well-located properties close to Cambridge, Saffron Walden, Ely, Newmarket and Haverhill, as well as good schools and transport links helping to ensure desirability for houses for both domestic and overseas buyers.
Throughout this year, realistic prices will remain key. Properties that are well presented and sensibly priced are likely to attract strong interest and transact efficiently, whereas over-ambitious pricing is increasingly challenged by a well-informed and value-conscious buyer pool.
Overall, the market is unlikely to see rapid price inflation in the short term, 2026 is shaping up to be a year of increased stability, improved transaction volumes, and more balanced negotiations. For buyers and sellers alike, the market should offer good opportunities where expectations are realistic and advice is well grounded.”
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