Modest house price growth may offset easing mortgage costs for home buyers this year
January 7, 2026
Analysis of new data* from Moneyfactscompare.co.uk illustrates how easing mortgage rates may allow for a modest growth in house prices in 2026 without improving or worsening current affordability pressures on first-time buyers and homemovers.
*Consumers comparing mortgage deals on moneyfactscompare.co.uk in 2025 and Moneyfacts Average Mortgage Rates.
First-time buyers
- Typical first-time buyers borrowed around £236,000 in 2025
- Average property value of around £310,000
- Average loan-to-value (LTV) of 78% // Avg deposit of 22%
Homemovers
- Typical homemover borrowed around £251,000 in 2025
- Average property value of around £466,000
- Average LTV of 58% // 42% equity
Remortgage borrowers
- Typical remortgage customer borrowed around £215,000
- Typical property value of around £460,000
- Average LTV of 50% // 50% equity
Average mortgage rates
Markets currently predict the Bank of England will lower the Base Rate from 3.75% to 3.25%-3.5% this year.
| Product / Scenario | 1 Jan 2026 | End of 2026 |
| 90% LTV 2-yr fix | 5.09% | 4.80% |
| 80% LTV 2-yr fix | 4.80% | 4.50% |
| 60% LTV 2-yr fix | 4.28% | 4.00% |
| First-time buyer at 80% LTV | Borrow £236,000 → £1,352 per month | Borrow £241,900 → £1,345p er month |
| Homemover at 60% LTV | Borrow £251,000 → £1,364 per month | Borrow £257,275 → £1,358 per month |
| Remortgage at 60% LTV | Borrow £215,000 → £1,168per month | Borrow £215,000 → £1,135 per month |
|
Source: Moneyfacts. Average mortgage rates assume a 0.25 percentage point Base Rate cut. Mortgage repayments assume repayments over 25 years. FTB and homemover figures assume 2.5% annual house price growth as forecasted by OBR. |
||
You May Also Enjoy
Property expert on how to bag the BEST mortgage deal in today’s market
Finding a good mortgage deal in today’s market demands more than just comparing rates. While the average 2-year and 5-year fixed mortgage rates have gone down this year, they’re still higher than rates pre-pandemic. This means those in their current homes will have to pay more than they once were each month, and new buyers…
Read More 
Halloween Named the UK’s Most Popular Moving Day of 2025
Halloween was the most popular day to move house in 2025, breaking the long-standing trend of summer being the busiest time for home moves. We analysed the data and spoke to industry experts to understand why the peak moving day has shifted and why it fell on an international holiday. Compare My Move reviewed more than 170,000 house moves made in 2025 and…
Read More 
Industry Response to Halifax House Price Index
Industry response to the Halifax House Price Index December 2025 The latest index shows that: – On a monthly basis, house prices fell by 0.6% between November and December of last year. Annually, house prices were up 0.3% versus this time last year, although this annual rate of growth had slowed from 0.7% the previous…
Read More 
Halifax House Price Index December 2025
House prices in December 2025 were 0.3% higher compared to the same month a year earlier. UK house prices dipped in December • House prices dipped by -0.6% in December, following a -0.1% fall in November • Average property price is now £297,755, the lowest since June • Annual growth slowed to +0.3%, down from…
Read More 
Homebuyer demand returns following Autumn Budget
New research from Property DriveBuy reveals that Bristol, Tyne & Wear, and South Yorkshire emerged as the UK’s most in-demand areas of the housing market following the Autumn Budget, with as many as 61% of homes listed for sale successfully securing a buyer in Q4 2025. Property Drivebuy analysed residential listings data across the nation…
Read More 
Economic uncertainty tops agents’ worries in 2026
“Make-or-break” 2026 looms for estate agents as costs, red tape and reform pile pressure on sector Agents warn of ‘survival year’ ahead as new Alto Agency Trends Report reveals deep fears over rising costs and regulation UK estate and letting agents are heading into 2026 fearing a make-or-break year, as soaring costs, economic uncertainty and…
Read More