UK Property Market News: Where are Mortgage Rates Going?

Last year, the cost-of-living crisis combined with the value of the pound dropping meant that many households delayed their plans to move home. But as we approach the end of February, and mortgage rates continue to drop, the property market is looking far more optimistic for prospective buyers looking to purchase a new home this year. In fact, Martin Lewis, the renowned financial expert said on television that if you can afford to move, don’t wait. 

As property developers based in Buckinghamshire, we understand that buying a new home is one of the most expensive purchases you are likely to ever make. It is therefore important that when considering mortgage rates, you understand the current condition of the UK mortgage market and find a deal that works for you. 

Our partnerships with trusted independent financial advisors allow our customers to receive the best advice to suit their situation, whether they’re buying their first home, upsizing, downsizing, or just looking for a fresh start. 

What happened to the property market in 2022? 

Last year, there was a lot of talk in the news about how the end of the Help to Buy scheme, increased interest rates and pulled lender products had affected the property market. For this reason, and to reduce customer worry, we hosted our Free Mortgage Advice at our new build development in Surrey, Amber Waterside. 

During the event, we spoke to new home buyers about the current property market, and independent brokers Purely Financial Planning offered their advice and expertise to find special rates from major lenders that are not available to the general public. Whilst lenders pulled mortgage products from the market in October 2022, the replacement products continue to see rates dropping on a regular basis. 

Where are UK market rates going now?

Following the mini-budget in September 2022, mortgage rates shot up and fixed deals below 5% completely disappeared from the market. 

It wasn’t until November that rates began to improve, but since then, they have continued to tumble. In fact, mortgage fixed rates have dropped by 1.75% when compared to late last year, meaning that home buyers can save thousands of pounds when securing a 5-year fixed rate mortgage in 2023. 

How has buyer demand been affected?

According to Zoopla, there have been encouraging signs that demand has rebounded at the start of the year, with buyer numbers back to pre-pandemic levels, similar to 2018 and 10% higher than in 2019. This reflects a “slow burn” but certainly creates a promising start to 2023. 

Consumer confidence is growing following the recent news from that the Bank of England inflation rate is reducing, and the overall forecast is appearing more favourable for the general UK economy. 

Increased affordability on new homes 

The overall forecast for the UK property and mortgage market is certainly more positive. This is also true for those specifically looking at purchasing a new build home. 

An increasing number of lenders appear to be offering better deals for those looking at more sustainable new home options. For example, customers at Halifax can take advantage of Green products with a £250 cashback or, for those at 75% LTV or below with a five year fixed rate, customers will get an income boost of up to 9%. This is due to them reviewing the true costs of living in a greener home. 

Leeds Building Society are taking new home energy efficiency further and offering enhanced affordability across all A and B rated homes. All homes from Nicholas King Homes have an energy rating of B or higher, with the aim to be an A rating for all future developments. Find out more about how our new build developments can save you energy and money.

Buckinghamshire property developers 

Nicholas King Homes is committed to not only building superb new homes, but also in helping our customers throughout the whole house-buying process. Whether you are buying your first home, need more space for a growing family or just looking for a fresh start – we can help find the best source of finance.

We will introduce you to one of our trusted independent financial advisors, who will provide you with the best advice to suit your situation in line with current mortgage rates and products available. 

We currently have a range of properties available across the South of England, including new builds in Berkshire and new homes in Surrey. To find out more about our available developments or our free financial advice, please contact us or speak to our sales team on 01494 811823 or via sales@nkhomes.com. 

Looking for more information about the property market?

Explore our articles on interest rates on new fixed mortgage deals that continue to drop and the fact 100% mortgages are now back.