06 MORTGAGE NEWSLETTER mortgage market softened, according to the latest Mortgage Market Tracker report from IMLA, which is great to see. 57% of advisers said they were ‘very’ confident about the outlook for their business, while 43% described themselves as ‘fairly confident’, highlighting the resilience of adviser firms despite challenging conditions. Business volumes eased modestly, with the average intermediary placing 89 mortgage cases over the previous 12 months, down from 92 in Q3 but still significantly higher than the 80 cases recorded in Q4 2024. While activity slowed slightly quarteron-quarter, conversion metrics improved across the mortgage process. You wouldn’t expect my introduction not comment on AI… as it seems to dominate conversations. A recent report from the Yardstick Agency found traffic from AI to adviser/planner websites is up 89% in the last six months. It appears AI is being adopted at a much faster pace than Google was in the early 2000s, which means the trend is only heading one way. There are three main ways clients are searching, to research an adviser/planner they’ve been recommended to, to compare two or more advisers/planners they’ve been considering, or, as an alternative to a traditional Google search for an adviser/planner. In conclusion, so far in 2026, the UK mortgage and lending markets were in a stable position, but recent events could be blowing the market off course just as we enter the “busy” period. Perhaps, the year is shaping up to be defined less by new lending expansion and more by refinancing, retention, and careful credit selection. It’s now perhaps not going to be a “Boom” market, more an Adviser market, where advisers continue to lead the way in solving their clients requirements particularly at a time when cool heads are needed with rates being pulled or going up . I hope you enjoy reading this edition, and as usual our thanks go to the contributors and sponsors, without you we would not be able to do this. drive a strong rebound in transactions. The Budget for Responsibility Committee (BRC) anticipates that house price inflation will average just over 2.5% for the remainder of the forecast period in the Spring forecast. This rate is expected to align closely with average income growth, suggesting a stable but modest rise in property values. This outlook remains largely consistent with last November’s forecast. For those with mortgages, the average effective interest rate on outstanding loans is projected to rise from 4.1% this year to 4.5% over the rest of the forecast period. This is 0.3% lower than the November BRC forecast, reflecting lower market expectations for interest rates. Regarding the supply of new homes, net additions to the UK housing stock are forecast to fall from an average of 260,000 per year in the early 2020s to a low of 220,000 in 2026/27. This dip is attributed to the effects of a recent slowdown in housing starts. Across the broader lending market, bank balance sheets remain strong, capital levels are high, and regulators have modestly eased capital requirements, supporting a renewed appetite for lending. Business lending growth is expected to slow slightly in 2026, while consumer credit growth remains steady, reflecting household resilience but also ongoing cost‑of‑living pressures. Non‑bank Lenders continue to play an important role, particularly in specialist mortgages, SME finance and higher‑risk credit, drawing increasing regulatory scrutiny. From an adviser perspective, a recent report on adviser fees showed advisers charge for purchases rose to £643, a 28.6% increase year-on-year. Although, most buyers paid between £500 and £700, with £500 being the most common fee. Less than 10% paid £300 or less. Interestingly, fixed fees were most popular at 44%, but 29% paid a fee based on the loan amount, 19% paid a percentage of property value and 7% paid a split fee. I have read that advisers started 2026 with rising confidence in their own businesses, even as sentiment toward the wider
RkJQdWJsaXNoZXIy MjI4MjU4NQ==