It’s a new year and a fresh start for the mortgage and housing markets. As always, we’re here to break down the hype in the headlines and explain what they mean for you. So, let’s take a look at the latest market figures.


No Bank of England base rate cuts, but lenders press on

The Bank of England held the base rate steady at 5.25% in January, disappointing those of us who hoped it would be cut for the first time since 2021. January brought a surprise increase in inflation – albeit a very small one – and inflation is expected to continue trending downwards. However, it may be a while longer before we see the Bank cut the base rate.¹

Even so, lenders have been dropping their own interest rates over the last couple of months, encouraged by the more positive medium-term picture for inflation and the base rate. This month saw the return of sub-4% mortgage deals to the market for the first time in eight months, which is great news for first-time buyers and remortgagers. New deals in this range are mostly five-year fixed mortgages – and some lenders have been quicker to reduce their rates than others – but there’s generally a much wider choice of mortgages available now than there was before Christmas.

So, now’s a better time to look for a deal, and we can help find the right one for you! Head in-app to Accounts > Mortgages to start a conversation with expert brokers at Moneybox Mortgages.

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Mortgage approvals are on the up again, as confidence returns

In December, mortgage approvals climbed for the third month in a row, to just over 50,400.² It’s been really encouraging to see confidence returning to the market, as more buyers and remortgagers have been able to afford mortgage rates, and there have been an increased range of deals on offer. We hope to see this trend continue as the year goes on.


House prices fall, creating opportunity for buyers

House prices are now falling – as of November 2023, the average UK house costs £284,950. Prices have fallen by 0.8% compared to October 2023 and are 2.1% down compared to this time last year.³ 

If this data sounds out of date, it is! When we talk about house prices, we always look at the UK House Price Index as the fairest measure of the market. It measures the sold prices of all UK house purchases and sales recorded in the Land Registry – so there’s a reporting lag. It’s likely that we’re seeing a trickle-down effect from the past few months. Other measures of the market- including the Rightmove House Price Index and Halifax House Price Index – are much more up to date, but much less representative, as they only report asking prices.

This is not great news if you’re putting your house on the market, but, if you’re a first-time buyer like many of our Lifetime ISA customers are, see this as a window of opportunity! House price falls have been few and far between in recent years. So, if you’ve finished saving your deposit and you’ve calculated that you could afford mortgage repayments at current levels, it might be your time to buy.


¹ Source: Office of National Statistics (ONS) CPI Annual Rate of Inflation
² Source: Trading Economics, UK Mortgage Approvals for December 2023
³ Source: GOV.UK Land Registry (UK House Price Index for November 2023)