A Budget-driven slowdown in October has given way to more decisive buyers and a renewed focus on affordability
Mortgage approvals dipped in October as households paused decisions during the protracted Budget build-up, though brokers say buyer intent has not vanished, instead shifting into more deliberate, affordability-driven behaviour that is reshaping pipelines in the final quarter of the year.
Fresh Bank of England data shows that net mortgage borrowing slowed to £4.3 billion in October, down from £5.2 billion in September. Purchase approvals slipped to 65,000 and remortgage approvals fell to 33,100, the lowest level since February 2025, as borrowers waited for fiscal clarity. Consumer borrowing also cooled as households assessed tax implications.
Buyers become more selective rather than stepping back
This period of pause was evident across broker pipelines. Katrina Horstead, director at Versed, said clients pressing ahead were “very clear on their long term plans” and were building today’s rates into their calculations from the outset. She noted that many homeowners had temporarily held off ahead of the Budget, but “since then, there has been a noticeable shift” as borrowers sought certainty over payments.
Craig Head, director at Mortgage Required, reported a similarly subdued pattern: “Activity has been and does still remain relatively flat,” adding that the Budget process “pushed possible buyers into the seasonally quiet Christmas period.” He said remortgage volumes often hinge on how proactive a firm is, arguing that where brokers explain early rate locks and regular reviews, “you can impact the volume of remortgage business being transacted.” When left unguided, he said, clients often delay on the belief that rates will fall further.
First-time buyers remain resilient
Despite broader caution, first-time buyer appetite has held firm. David Titherington of The Mortgage Station said new entrants were still pursuing opportunities, provided monthly payments remain manageable. “As long as monthly payments are affordable, they are happy to take advantage of the uncertain market and attempt to gain some price reductions,” he said.
He also noted he had not seen a slowdown in refinancing, emphasising that many lenders allow borrowers to lock in early and switch later, meaning “there should be no reason for them to hold off” when properly advised.
Affordability pressures still driving behaviour
Affordability constraints continue to shape both purchase and refinancing trends. Gen H chief executive Graham McClelland said he has seen rising demand from borrowers needing additional support to pass affordability checks, noting this “points to the fact that, while there are near record numbers of properties available to purchase, demand is still constrained by affordability – even if it has eased slightly in recent months.” Buyers remain motivated, he added, but often require help bridging affordability gaps - something that has become increasingly prominent through H2.
McClelland also warned that many refinancing households may be unaware of viable options open to them. If delays are stemming from affordability stress, he said, lenders and brokers “will need to consider how they can support remortgagers, not just first-time buyers,” especially as some remain unaware of available tools simply because “the narrative is so focused on first-time buyers that remortgagers may not be aware of their options.”
A steadier tone expected into 2026
Brokers broadly expect the current lull to give way to a more predictable 2026. Horstead anticipates postponed activity returning and a “more steady and predictable market” next year. Head expects a pick-up as rate trends stabilise, while Titherington believes 2026 will be “a good year for home movers and first time buyers” if inflation remains controlled, though he warned that new tax changes could weigh on the buy-to-let sector.
While October’s slowdown reflected fiscal uncertainty and rate speculation, brokers say it has not dented underlying demand. Instead, the market is being reshaped by more selective buyers, more tactical remortgagers, and a renewed emphasis on early, informed affordability planning.
