As the first snowdrops push through the soil, you might be looking for a fresh new home.
Let’s explore the various factors shaping the property market this January, from more affordable mortgage rates to the ripple effects of the Autumn Budget.
A relatively busy market
Traditionally, the first few weeks of the year are pretty quiet. Most buyers and sellers prefer to wait until spring to kick-start their efforts.
However, this year is a bit different. The run-up to November’s Autumn Budget saw many people adopt a cautious, wait-and-see approach, putting off making any major financial decisions. Now that the government budget has been announced, those people could make up for lost time.
This uptick in market activity might continue throughout January and beyond. A higher number of properties could come up for sale, joined by more buyers, too. Prepare for the market to move quite quickly – for example:
- Decide on the specifics of your property criteria
- Research your mortgage options
- Organise your paperwork if you’re selling a property
Ongoing favourable mortgage rates
Last year, mortgage lenders made a real effort to loosen their lending criteria to help people borrow more. Rates become relatively affordable, with fixed rates starting at 3.51%.
This increase in affordability was further supported when, in December, the Bank of England cut the base rate to 3.75%. As industry experts predict further cuts this year, the trend for lower mortgage rates will likely hold.
As ever, make sure to thoroughly research your options before committing to a mortgage. Here’s some recent advice from Trinity Financial.
Good news for first-time buyers
In 2025, first-time buyers accounted for every two in five property sales. This market dominance is expected to continue this year, thanks to the likelihood of average wage growth outpacing property prices, more affordable mortgages, and a better choice of properties hitting the market.
If you’re hoping for your first rung on the property ladder, don’t forget to look into first-time buyer schemes, which might help you buy a home for up to 50% less than its market value.
Meanwhile, at the upper end of the market? The so-called ‘mansion tax’ – where owners of properties over £2 million pay an annual surcharge – may create sluggish demand.
Market conditions vary across the UK
While looking at the above information, keep in mind that the exact picture depends on where you’re buying. There’s a clear north-south divide in house price growth – Zoopla reports small price falls of up to 0.6% in Southern England, contrasted with house price inflation of up to 2.9% in the North West.
It seems London and the surrounding counties may feel the ongoing effects of higher stamp duty and other moving costs.
Get local expertise from an estate agent
We hope this January market snapshot has been useful. For more specific advice on the property market where you’d like to buy, get in touch with the nearest Winkworth office and an experienced estate agent will help guide your search.
