Your festive financial update

Season’s Greetings: A Look Back at 2025

As the festive lights twinkle and the year draws to a close, we want to take a moment to wish all our clients, partners, and friends a very Merry Christmas and a Happy New Year. The holiday season is a time for reflection, and looking back at 2025, it has been a landmark year for the mortgage and housing markets. After the volatility of previous years, 2025 was defined by one word: Resilience.

This year, we saw a much-anticipated shift toward stability. Here are the key trends that shaped the market over the last twelve months:

Rate Relief: After peaking in 2023 and 2024, mortgage rates finally found a more comfortable range. The Bank of England’s gradual cuts—bringing the base rate down to 3.75% this December – offered a welcome reprieve for those on tracker mortgages and provided more competitive fixed-rate deals for new buyers.

The Mortgage Lock-In Thaw: As rates stabilised, the lock-in effect began to ease. More homeowners felt confident listing their properties, leading to a healthy 12% increase in housing inventory compared to last winter.

Affordability Gains: While house prices showed modest growth of roughly 2–4%, rising real wages and cooling inflation meant that for many, the dream of homeownership became significantly more attainable this year.

First-Time Buyer Surge: Despite changes to Stamp Duty thresholds in April, the market saw a robust wave of first-time buyers eager to capitalise on the price war between lenders competing for new business.

Looking Ahead to 2026
While 2025 provided the stability we craved, the journey doesn’t end here. Experts predict that 2026 will continue this gradual downward path for borrowing costs, potentially opening even more doors for those looking to remortgage or step onto the ladder.

The housing market in 2025 demonstrated remarkable resilience. This rebalancing is exactly what was needed to restore long-term accessibility to the market.

Thank You
Our success this year is entirely due to the trust you place in us. Whether you finally picked up the keys to your first home, optimised your investment portfolio, or successfully remortgaged to save on your monthly outgoings, it has been an honour to navigate this landscape by your side.

Remember, if you need advice when it comes to mortgages, a Mortgage Adviser can simplify the process, improve your chances of approval, and save you money – making them a smart choice for homebuyers. To find out more, contact the team on 03454 500200 or email hello@mortgagedecisions.com.