Providing expert mortgage advice for over 28 years.
Providing expert mortgage advice for over 28 years.
As we look towards 2025, the UK mortgage market is set for significant changes. With interest rates expected to fall and government initiatives aimed at boosting the housing sector, potential homebuyers have much to consider. Here’s a comprehensive guide to what you can expect in the coming year and beyond.
Good news, the Bank of England is anticipated to lower the base rate from its current high, potentially reaching 3.5% by mid-2025 and even lower by 2026. This base rate cut is expected to make borrowing more affordable, leading to:
Recent months have seen fluctuations in rates, but the end of next year looks promising for borrowers. The current base rate, while still higher than during the global financial crisis, is predicted to fall, offering welcome relief to mortgage customers.
The Monetary Policy Committee has signalled potential rate cuts in the near future. This trend is expected to continue, with further cuts likely in the coming years. The International Monetary Fund predicts that the UK inflation will stabilise potentially boosting economic growth.
As interest rates fall, lenders are likely to offer more competitive deals. This could lead to:
Homeowners with tracker mortgage products or on standard variable rates may see a reduction in their interest payments and overall payments. For those currently on fixed rate term deals, it is worth considering when to switch to take advantage of potentially lower rates.
At Newhomes, we offer a Mortgage Rate Check service, If interest rates drop before your mortgage is finalised, we can help you switch to a lower rate, if available, potentially saving you money. This service will be particularly valuable to customers in 2025 as the market shifts.
Switching to a different lender may incur additional costs/charges
The latest budget announcement revealed plans to build 1.5 million new homes over five years, focusing on affordability and utilising brownfield sites. Key initiatives include:
These initiatives aim to address ongoing challenges in the housing market, potentially easing pressure on house prices and improving accessibility for first-time buyers.
From 1st April 2025, stamp duty changes to the threshold will be:
For first-time buyers:
These stamp duty changes could increase upfront costs for some buyers but are designed to stimulate the market by encouraging home purchases before the new rates take effect.
Several schemes are available to assist homebuyers:
For those with existing Help to Buy loans, 2025 could be the ideal time to consider remortgaging. Our Remortgage team specialises in guiding clients through the remortgaging process, including Help to Buy remortgages. We can help you potentially secure better terms and interest payments.
With mortgage lending expected to grow by over 3% in 2025 due to falling interest rates and improved economic conditions:
UK interest rates are influenced by global economic factors:
Recent weeks have seen shifts in the global economic landscape that could impact our domestic market. Stay informed about international economic news as it can provide insights into potential future trends in the UK mortgage market.
The Financial Conduct Authority continues to play a crucial role in protecting mortgage customers:
As we approach 2025, the UK mortgage market presents both opportunities and challenges. The potential for lower interest rates and government support schemes offers hope for many aspiring homeowners. However, it’s crucial to approach the market with careful consideration.
At Newhomes, we’re committed to helping you navigate these changes. Whether you’re buying your first home, moving to a new property or refinancing an existing mortgage, our expert team is here to provide personalised advice and support.
Remember that while predictions can provide valuable insights into what lies ahead in this evolving landscape; it’s essential always to base your decisions on your personal financial situation. With good planning and smart choices, you’ll be fully prepared for the changing mortgage scene in 2025 and beyond.
Contact us today! We can discuss your mortgage options and help you succeed in this changing market! Our experts will ensure you’re prepared to make informed choices about your future.
