As we move into the second half of January, the UK property market is buzzing with an energy. Following the Bank of England’s decision to cut the base rate to 3.75% in late December, the mood across the country is one of renewed confidence.

For both buyers and sellers, the start of 2026 feels fundamentally different. Here is a look at why this January is such a proactive start to the year.

1. For Buyers: Lower Costs and More Choice

The reduction in the base rate has triggered a competitive mortgage market, with many lenders revising their portfolios to offer more attractive rates.

Improved Fixed Rates: Many 2-year and 5-year fixed rates are now comfortably below the base rate, with some high-equity deals reaching as low as 3.5%. This is providing buyers with more manageable monthly repayments than we have seen in recent months.

A Wealth of Options: The number of available mortgage products is currently at a high for this time of year. This variety means that whether you are a first-time buyer with a 5% deposit or you are looking to downsize, there is a tailored deal waiting for you.

Increased Borrowing Power: With inflation now stabilised at 3.2% and trending toward the 2% target, lenders are applying more favourable affordability "stress tests." Many buyers are finding their borrowing capacity has increased just in time for their January search.

2. For Sellers: A Surge in Serious Interest

The "New Year bounce" is backed by more than just tradition this year; it is backed by genuine momentum in the market.

Motivated Buyers: We are seeing a significant rise in buyer demand since the festive period ended. These aren't just "window shoppers" - they are motivated individuals who have been waiting for the interest rate cycle to turn before committing to a move.

Renewed Confidence: Following the clarity provided by the late 2025 budget, sellers can now plan their next move with a much clearer financial picture and more confidence in the stability of the market.

The Importance of Expert Advice

With rates changing quickly and so many products available, navigating the market alone can be overwhelming. This is why we recommend speaking to our in-house mortgage advisors at Mortgage Advice Bureau and Severn Mortgage and Protect.

Because they have access to over 99 lenders, they can search thousands of deals to find the specific mortgage that best suits your unique situation. Whether you are looking for the lowest rate or the most flexible terms, their expert guidance ensures you aren't missing out on the best opportunities currently available.

Looking Ahead: The 2026 Forecast

The consensus among economists is that the cycle of rate hikes is firmly behind us. Many experts predict that we could see further incremental cuts to the base rate as the year progresses, with some forecasting a move toward 3.25% by the autumn.

The Verdict: January 2026 represents a "sweet spot." Buyers are benefiting from the most competitive mortgage rates in years, and sellers are meeting a market hungry for new instructions. If you’ve been waiting for the right moment to move, the conditions suggest that the moment has arrived.

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Ready to make your move?

The market is moving fast this month. If you’d like a factual, up-to-date valuation of your home or advice on how these latest rate changes affect you, our team is here to help.