## Improving Market Conditions Offer Hope for First-Time Buyers

Recent forecasts indicate modest house price growth in 2026 combined with easing mortgage rates, signalling a stabilisation in the UK housing market after a period of volatility. According to Propertymark, these factors are beginning to restore confidence among aspiring homeowners, particularly first-time buyers who have struggled to enter the market. Lower monthly mortgage repayments are making homeownership appear more achievable as lenders respond to calmer market conditions by trimming rates.

## Property Tax Remains a Significant Barrier

Despite these positive trends, Propertymark’s chief executive Nathan Emerson emphasises that affordability challenges persist, largely due to property tax thresholds failing to keep pace with rising house prices and wage growth over the past decade. This mismatch has increased the upfront tax burden on buyers, particularly impacting first-time purchasers. Emerson states: “Propertymark believes reform is needed to create a fairer, more responsive property taxation systems across the UK that reduce upfront costs, support first-time buyers, and improve market mobility.”

He further highlights that alongside tax reform, boosting housing supply and providing targeted support for those struggling to save for a deposit are essential measures to make homeownership a realistic option for more people.

## Structural Issues Beyond Mortgage Costs

While cheaper mortgages improve affordability, Propertymark warns that they alone will not resolve deeper structural problems in the housing market. High property values, elevated rents that restrict saving ability, sizeable deposit requirements, and the slow pace of homebuilding continue to act as significant obstacles for first-time buyers.

## Impact of Temporary Pandemic-Era Tax Measures

Propertymark also notes the influence of temporary property tax reliefs introduced during the pandemic, which helped sustain higher transaction levels. For example, in 2020 and 2021, England and Northern Ireland saw a substantial uplift to the nil-rate band for Stamp Duty Land Tax on residential purchases. Scotland and Wales introduced similar temporary increases to their respective transaction tax thresholds. These measures reduced upfront costs for a broader range of buyers and supported market activity.

Despite this, the number of property transactions has declined from 1,073,308 in 2021 to 920,052 in 2025, a fall of 14.3% over four years, illustrating ongoing challenges in the market.

## What This Means for Landlords and Agents

For landlords and letting agents, the current market signals a more balanced housing environment with slower, more sustainable price growth and improving mortgage affordability. However, the persistent property tax hurdles and structural barriers to homeownership may continue to limit the pool of potential first-time buyers, affecting demand dynamics in the private rented sector. Monitoring ongoing tax reforms and housing supply initiatives will be important for anticipating future market shifts.

Suggested internal link anchors
– house price growth
– mortgage rates
– property tax thresholds
– first-time buyers
– housing supply
– deposit requirements
– Stamp Duty Land Tax
– market mobility
– affordability pressures
– homeownership options
– property transactions
– housing market volatility

TLA update

TLA is launching a new Trusted Partners Hub in Q1 2026, featuring verified and approved service providers selected to support landlords, tenants, and property management businesses. We are inviting legal, trades, insurance, financial, mortgage, tenant screening, and other service providers to register their interest here: https://landlordassociation.org.uk/become-a-tla-service-partner/