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
How will tenants be affected by the incoming Renters’ Rights Act?
On 28th October 2025, the Renters’ Rights Bill was passed into law, and it is now the Renters’ Rights Act. Changes to legislation resulting from this new Act will take effect from May 2026. This will affect landlords and how they let out their property, and it is worthwhile being aware of how it affects…
Read More 
Gibraltar property values rise faster than UK
Gibraltar house prices rise faster than UK and London, despite market activity dropping 46% The latest market analysis by Enness Global has revealed that Gibraltar’s property market has seen stronger annual house price growth than both the UK and London, even as the number of transactions completing across the market has fallen sharply, creating a…
Read More 
Homes with fewer photos priced £80,000 lower
The latest research by London lettings and estate agent, Benham and Reeves, has revealed a stark disparity in asking prices depending on how extensively a property is marketed, with homes listed using four photos or fewer priced almost £80,000 lower on average than those benefiting from five or more images. Benham and Reeves analysed current…
Read More 
January market momentum builds
Analysis of the latest market data by eXp UK has revealed that the UK property market has picked up pace in January, with both new instruction volumes and the price of these new listings increasing when compared to the same period in previous years. eXp UK analysed the latest market data*, looking at both new…
Read More 
Breaking Property News 28/1/26
Daily bite-sized proptech and property news in partnership with Proptech-X. Tenancy Deposit Scheme further enhances rental UX with continued tie up with tlyfe app TDS has announced a multi-year extension of its partnership with tlyfe, the fast-growing tenant lifecycle app powered by OpenBrix. Expanding coverage across England & Wales, Scotland and Northern Ireland, the new…
Read More 
More affordable locations grew most in price in 2025
New analysis of the 2025 market highlights that lower-priced locations grew the most in asking prices during 2025 as affordability continued to drive buyer behaviour Across the top 50 local areas where property asking prices grew the most last year, only seven are priced above the current national average of £368,031 Hawick in Roxburghshire in…
Read More