Brokers say a gentle reset may now be overdue
House prices in many parts of the UK now look “stretched”, as higher mortgage rates squeeze affordability and leave more first-time buyers on the sidelines, according to broker Louis Mason of Oportfolio.
Speaking to Mortgage Introducer, Mason said that outside prime London in particular, the relationship between prices, incomes and borrowing costs has become increasingly strained.
“In many areas, especially beyond prime London, prices feel stretched,” he said. “The market has already absorbed a lot of rate rises, but affordability is tight. For some buyers, a modest correction would create a healthier balance between supply, demand and borrowing costs.”
Higher rates slowing transactions
Mason said the sharp rise in mortgage rates over the past two years has fundamentally changed what borrowers can sustain, making it harder to complete deals.
“Higher rates are definitely making it trickier to get clients over the line,” he said. “Buyers who were comfortable at 2–3% are now struggling at 5–6%. That affects how we structure cases and often slows transactions down.”
As a result, brokers are seeing more complex affordability conversations and a shift in case placement.
More buyers failing affordability checks
Compared with 12 to 18 months ago, Mason said a growing number of first-time buyers are being priced out altogether.
“We’re seeing more failed affordability checks, even where incomes haven’t changed,” he said. “A typical example is a young couple earning £80,000 between them who would have been fine last year but now face limited options, forcing them to delay or scale back their plans.”
Flat prices preferred to a sharp correction
While some clients are questioning whether prices need to fall, Mason believes a period of stability would be a better outcome than a sudden drop.
“A healthier market would be flat prices for six to twelve months,” he said. “That would give buyers breathing space without shocking the system. Sharp falls are disruptive, whereas modest, predictable adjustments help maintain confidence and keep deals moving.”
Focus shifting to long-term sustainability
For brokers, Mason said 2026 is increasingly about resetting expectations and emphasising long-term affordability rather than maximum borrowing power.
“Managing expectations is a big part of our role now,” he said. “We’re spending more time helping clients focus on what they can comfortably sustain over 25 years, not just what they can technically borrow. Sometimes that means advising them to wait or rethink location.”
Uneven impact across the market
The pressure is not being felt evenly. Mason said first-time buyers and areas that saw rapid growth during the pandemic are among the most exposed.
“First-time buyers are feeling it most, particularly in commuter towns,” he said. Home-movers are also cautious, especially those carrying large mortgages, while buy-to-let investors are often waiting for rates to settle before committing.
Overall, Mason’s comments point to a market in need of rebalancing rather than a crash, with many brokers favouring a period of flat or gently adjusting prices to ease affordability pressures—especially for first-time buyers now struggling to get a foothold.
