The Intermediary – December 2025 - Flipbook - Page 10
RESIDENTIAL
Opinion
RENEWED CONFI
BROKERS AND BO
s we reach the end
of 2025, the mood
across the mortgage
market feels
markedly different
from the anxiety that
characterised the middle of the year.
The run-up to the November
Budget froze the housing market,
with rumours of radical property tax
reforms prompting more than 10,000
movers to pause plans.
But the Chancellor ultimately
stepped back from the most disruptive
options, and the relief across the
industry has been palpable.
There is now greater space for
confidence to return – brokers are
entering 2026 with a clearer sense of
stability than they have enjoyed for
some time.
This greater economic and political
certainty is no small thing. For over
two years, advisers and their clients
have had to navigate volatile swap
rates, unpredictable pricing, on-off
house price forecasts and shiing
expectations around interest rates.
In contrast, the backdrop as we
move into 2026 is calmer, more
comprehensible and, crucially for
brokers, far more conducive to longterm planning. Inflation continues to
fall, the Bank of England is forecasting
Bank Base Rate at around 3.5% by
the end of 2026 and lenders remain
fiercely competitive, with more than
7,000 products on the shelves.
Aer a long period of firefighting,
advisers can once again spend more
of their time on proactive client
engagement rather than crisis
management.
A
In borrowers’ favour
The regulatory environment
is also beginning to work more
8
The Intermediary | December 2025
constructively for borrowers. The
Financial Conduct Authority’s (FCA)
relaxation of certain affordability
rules and the loosening of loan-toincome (LTI) flow limits haven’t yet
fed through fully into completed sales,
but the market should grow in 2026
as more customers qualify for higher
loans following the changes.
For brokers, this means more
first-time buyers whose plans might
finally be within reach, more options
for single-income applicants, and
a broader conversation with clients
about how much borrowing is
realistically achievable.
Aer several years in which
affordability was the dominant
constraint, this shi provides
welcome breathing space.
Remortgaging will remain a
dominant theme next year, with
another wave of pandemic-era fixes
due to mature. Many borrowers
rolling off 2- and 5-year deals will
need the kind of nuanced advice only
intermediaries can provide: balancing
payments, term lengths, product types
and wider financial goals.
In 2025, we saw a strong return to
advised remortgaging aer a period
in which high rates had pushed many
towards product transfers simply to
avoid affordability hurdles.
With rates continuing to fall, 2026
will strengthen this trend further.
Brokers will have more opportunities
not just to save clients money, but to
carry out the full financial review that
so many households have deferred
amid the cost-of-living squeeze.
Rental pressures
The buy-to-let (BTL) sector remains
more complex. The Renters’ Rights
Act will be fully felt in 2026, and the
Chancellor’s 2% increase in Income
KATE DAVIES
is executive director at
the Intermediary Mortgage
Lenders’ Association
Tax on rental income will tighten
margins further for the 81% of
landlords who hold property in their
own names.
Smaller landlords are likely to feel
the pressure most acutely. Some will
choose to exit, others will raise rents,
and increasing numbers are likely
to follow the long-running shi into
limited company structures.
Brokers will play a central role
in guiding investors through these
decisions and referring them to tax
advisers where appropriate. The
demand for professional advice here is
only going to grow.
Modernising the market
Beyond the immediate economics, one
of the most transformative forces for
brokers in 2026 may come from the
long overdue modernisation of the
homebuying process.
The Government’s consultation
on digitising the property
transaction system, including
digital property packs, standardised
data, interoperable systems and
mandatory qualifications for estate
agents, could result in material
