A Market Finding Its Feet: Latest Quarterly Mortgage Market Update

The mortgage market has rarely stood still (in fact in recent years there have been regular significant economic events), but recent months have been especially unsettled. Geopolitical instability, changing rate expectations and shifting product availability all created uncertainty for advisers and their clients. The picture for now is more encouraging: pricing is settling, lender confidence is improving and advisers have a clear opportunity to help clients act with confidence. 

Earlier this year, markets moved quickly as expectations for interest rates changed in the immediate aftermath of the Iran war. Lenders responded cautiously, with swap rates and mortgage pricing shifting sharply and some products temporarily withdrawn while providers recalibrated (markets moved so fast that there were periods lenders were losing money on mortgages at the current rates so they had to withdraw quicker than they would have liked). More recently, conditions have become steadier as SWAP rates have stabilised, giving advisers and borrowers a more predictable environment in which to make decisions. 

A Surge in Demand—and Adviser Opportunity 

Volatility has prompted many borrowers to secure fixed-rate deals quickly, while a large volume of mortgage maturities is sustaining a strong remortgage market. Although questions remain around the strength of the purchase market later in the year, lending expectations remain resilient, with forecasts of around £300 billion in gross lending still holding up. For advisers, that points to continued demand and a strong pipeline of conversations. Lenders have also signalled an increase in purchase applications again in April and May, particularly for first time buyers, which is positive. 

Innovation Driving Accessibility 

Alongside this improving stability, lenders are still innovating to widen access. New low-deposit options (such as LBG £5k deposit mortgage and Santander £10k deposit mortgage), greater flexibility on income multiples and more family-assisted borrowing solutions are helping more first-time buyers and underserved customers consider home ownership. Yet many prospective buyers still rely on outdated assumptions about how much deposit they need or how much they can borrow, which gives advisers an important role in educating clients on what is now possible. 

Lender Support: A Quiet but Important Shift 

Lender support has also evolved in quieter but meaningful ways. As activity levels have increased, some lenders have made practical changes such as extending submission cut-off times and maintaining service levels under pressure. The difference in service standards on mortgage applications from most lenders compared to previous times of instability in the market has been able. This highlights that lenders learned some lessons and the increased use of technology to help operationally. Some opportunities also remain exclusive to intermediary channels, reinforcing the value advisers continue to bring in helping clients access the right options at the right time. 

The earlier withdrawal of some products was largely about managing pricing risk rather than credit quality. Now that rates have steadied, confidence is returning. For clients, though, recent volatility has underlined the value of expert advice when navigating rate movements, product changes and evolving criteria. 

Now that pricing has stabilised, confidence is returning across the market. But for clients, the recent volatility has reinforced just how important expert advice is—particularly when navigating rate movements, product changes, and evolving eligibility criteria. 

For advisers, this creates an opportunity to: 

• Proactively engage clients approaching maturity 
• Educate first-time buyers on new affordability and low deposit options 
• Reassure borrowers amid ongoing market uncertainty 
• Position themselves as trusted experts in a changing landscape 

The Bottom Line 

While the market has faced short-term disruption, the fundamentals remain strong. A healthy remortgage pipeline, continued lender innovation and improving rate stability all support a positive outlook for the months ahead. 

For advisers, the priority is simple: stay informed, stay proactive and help clients understand the options available. In a market like this, informed advice is not just valuable—it is essential. 

For adviser use only. Please note this content has been supplied by our lender partner and as such, is their responsibility. No party shall have any right of action against Legal & General in relation to the accuracy or completeness of the information in this article.