As the UK property market approaches 2025, confidence in property lending is on the rise. With interest rates expected to decline and consumer sentiment improving, the outlook appears promising for buyers, investors, and lenders alike.
The Bank of England has signalled potential rate cuts, with inflation cooling faster than anticipated.
Lower rates are expected to enhance affordability for borrowers and rejuvenate the housing market.
Islay Robinson, CEO of Enness Global, one of the world’s leading brokerage firms, shared his insights, “From our perspective, the broader outlook for UK property lending in 2025 is extremely encouraging. Interest rates are predicted to fall further by next autumn on both sides of the Atlantic, and we are already seeing a rebound in both consumer and investor confidence.”
A recent report by Halifax noted that house prices are stabilising after months of decline, providing an additional boost to buyer confidence.
One of our regular newsletter readers expressed her optimism for 2025.
“Lower interest rates will make a huge difference for first-time buyers like me,” said Emily, a 28-year-old teacher from Bristol. “I’ve been saving for years, and this feels like the opportunity I’ve been waiting for.”
Uk is ‘one of the most favoured destinations for property investment’
Barbara Chanakira, CEO and founder of Eaton Property Consultants, highlighted the continued global appeal of UK real estate.
Known as one of London’s top luxury brokers, Chanakira frequently works with international buyers, particularly from the U.S.
The UK’s resilience in the wake of global economic challenges, coupled with stable growth and promising returns through rental income and capital appreciation, makes it one of the most favoured destinations for property investment worldwide,” Chanakira said.
This sentiment is echoed by another regular TLPN newsletter reader, U.S. investor Mark, who recently purchased a property in Mayfair, “The UK offers a mix of stability and opportunity. London, in particular, feels like a safe and rewarding long-term investment.”
‘London to return to peak levels in the year ahead’
At the top end of the property spectrum, activity in the super-prime market continues to thrive.
London, in particular, is experiencing robust demand from domestic and international buyers seeking exclusive properties.
“Super-prime activity has been especially buoyant, and we expect London to return to peak levels in the year ahead,” Robinson said.
Chanakira also highlighted the unique allure of luxury properties, “London’s luxury market offers unparalleled value for international buyers. Whether for personal use or as an investment, these properties consistently deliver strong returns.”
Government pledge to build 1.5m homes
The government’s pledge to build 1.5 million homes over the next few years aims to address the persistent housing shortage. However, Robinson cautioned that the effects of this initiative will take time to materialise.
“The government’s ambitious plan will likely only significantly increase supply in future years. In the meantime, competition for existing properties remains high.”
For buyers like Liam, a 34-year-old IT professional from Manchester, the lack of supply is a major concern.
“I’ve been looking for a home for months, but everything gets snapped up quickly. More affordable housing options can’t come soon enough.”