Market Update September 2025

The mortgage market has felt steadier over the summer. The Bank of England cut the base rate to 4.00% in August, and it’s widely expected to hold steady at the next meeting later this month. Inflation has edged up slightly to 3.8%, which means we’re not out of the woods yet, but the overall direction is calmer than a year ago.

 

For borrowers, mortgage pricing has been relatively stable. Shorter-term fixed rates have hovered around 5%, with five-year fixes close to the same level. Behind the scenes, wholesale funding costs (known as swaps) have stayed steady, helping lenders avoid the sharp swings we saw last year.

 

The property market is showing resilience too. Rightmove reported that asking prices for new listings rose 0.4% in September, while both Nationwide and Halifax recorded annual house price growth of just over 2%. That suggests a balanced market – not booming, but not falling away either. Activity is also improving, with mortgage approvals for purchases reaching a six-month high in July.

 

For landlords, there’s a rare positive: buy-to-let rates are now at their lowest in three years, with some two-year fixes averaging under 5%. Even so, sentiment in the sector remains cautious as landlords weigh regulation and affordability against long-term returns.

 

Looking ahead, stamp duty thresholds reverted in April and further changes to leasehold and freehold rules are being phased in through 2025. These policy shifts, together with the current rate environment, mean planning ahead is more important than ever.

What this means for you

With rates stable but affordability checks still tight, the best approach this autumn is to plan early, lock in rates where possible, and keep options open. Whether you’re buying your first home, moving up the ladder, or reviewing investments, having a clear strategy in place will make all the difference.