Demand for secured lending for house purchase declined in Q4 2025, according to new research by the Bank of England (BoE), with demand expected to be unchanged in Q1 2026.

The central bank also revealed that secured lending demand for remortgage purposes was unchanged at the end of 2025 but is now expected to rise in Q1.

This is according to the latest Credit Conditions Survey from the BoE, a quarterly survey of banks and building societies aimed at improving the central bank’s understanding of developments in credit conditions.

The latest iteration of survey was conducted between 10 November and 3 December, covering the build-up to the Autumn Budget, and the BoE noted that any impact from more recent developments since had therefore not been captured.

“It’s unsurprising that demand for secured lending for house purchase decreased in Q4 as would-be buyers put decisions to move on hold as they waited to see what the Budget had in store,” commented chief executive of mortgage broker SPF Private Clients, Mark Harris.

“Speculation regarding various property taxes was incredibly unhelpful, creating uncertainty and inertia in the housing market.

“Demand for remortgaging was unchanged and is expected to pick up this quarter. Around 1.8 million borrowers are forecast to remortgage this year, with many of those on five-year fixes in particular facing a payment shock.

“With lenders reducing their rates in recent days and weeks, shopping around to see what is available from other lenders, rather than automatically taking the product transfer from your existing lender, is a sensible approach.”

Lenders survey by the BoE also reported that overall spreads on secured lending to households, relative to the base rate or the appropriate swap rate, had narrowed in Q4, and were expected to narrow in Q1.

Harris suggested this narrowing was “excellent news” for borrowers, with lenders keen to lend and competing with each other on pricing.

“With two-year fixes available from 3.5% and five-year fixes from just above 3.7%, the rock-bottom rates of the past may be long gone but pricing is becoming increasingly palatable,” added Harris.

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