UK Mortgage Market 2024: The UK mortgage market entered 2024 under pressure from higher borrowing costs, restricted affordability and cautious customer demand.

However, the year did not follow one simple direction. Mortgage pricing improved during several periods, buyer activity recovered and lender competition returned. At the same time, criteria, stress testing and case presentation remained critical.

For mortgage advisers, the central lesson was practical. A market can become more active without becoming less complex.

At a Glance

• Bank Rate remained at 5.25% until August 2024.
• It was reduced to 5% in August and 4.75% in November.
• First-time buyer and home-mover numbers increased.
• Affordability remained sensitive to rates, income and committed expenditure.
• Additional property purchases became more expensive after an SDLT change.
• Product knowledge and accurate case packaging became increasingly important.
• Mortgage networks helped advisers track criteria and place less straightforward cases.

Bank Rate began to fall

Bank Rate started 2024 at 5.25%. The Bank of England reduced it to 5% in August and then to 4.75% in November.

These reductions were important, but they did not immediately produce uniformly lower mortgage rates. Fixed mortgage pricing also reflected swap rates, lender funding costs, competition and expectations about future inflation.

Advisers therefore needed to explain why a Bank Rate reduction did not guarantee an equivalent reduction in every mortgage product.

The Bank of England’s Bank Rate history provides the official record of the changes.

Mortgage activity recovered

Mortgage activity performed more strongly than many forecasts had suggested.

UK Finance reported that first-time buyer numbers increased by 16.4% during 2024. Home-mover numbers rose by 14.7%. This indicated that demand had not disappeared. Instead, many customers had delayed decisions until pricing and household finances became clearer.

The improvement also created more varied adviser conversations. Customers needed help comparing:

• fixed-rate periods;
• product fees;
• early repayment charges;
• affordability calculations;
• lender criteria;
• the cost of waiting;
• the risks of proceeding too quickly.

The UK Finance 2024 household finance review provides further market data.

Affordability remained case-specific

Lower mortgage pricing during parts of 2024 did not remove affordability pressure.

Lenders continued to consider verified income, credit commitments, household expenditure, deposit size and the proposed mortgage term. Self-employed income, bonus payments, overtime and irregular earnings could be treated differently between lenders.

This made product comparison only one part of the adviser’s work. The lowest advertised rate was not always available or suitable for the applicant.

Network members could use Connect’s mortgage and rental calculators to support initial discussions. However, lender-specific affordability assessments remained necessary before making a recommendation.

Buy-to-let costs changed

The Autumn Budget introduced an immediate change for additional property purchases in England and Northern Ireland.

From 31 October 2024, the Stamp Duty Land Tax surcharge for additional residential properties increased from three percentage points to five percentage points.

For landlords, this increased the cash required at completion. It also affected the total cost of acquiring, refinancing or expanding a property portfolio.

Advisers needed to consider:

• deposit and tax funds;
• rental coverage;
• property value;
• ownership structure;
• portfolio exposure;
• refurbishment requirements;
• the landlord’s longer-term objectives.

Cases involving unusual properties, limited companies or complex rental arrangements could also require specialist lender criteria.

Connect’s mortgage packaging support for brokers can help advisers present specialist cases to suitable lenders.

Criteria mattered as much as rates

The 2024 market showed why mortgage advice cannot be reduced to a rate table.

Two lenders offering similar rates could assess the same customer differently. One might accept retained profits, while another might rely mainly on salary and dividends. Treatment could also vary for contractor income, adverse credit, flats, HMOs or properties requiring work.

Good case placement depended on identifying these differences before submission.

This reduced the risk of avoidable declines, repeated credit searches and delays for customers.

Advisers requiring help outside their own permissions or specialist knowledge could also use Connect’s referral service for mortgage advisers.

Technology changed customer behaviour

Customers increasingly used Google, mortgage calculators and AI tools before speaking with an adviser.

This gave many applicants a useful starting point. However, online information could not confirm whether a lender would accept a particular income source, property type or credit history.

For advisers, the practical response was not to compete with digital research. It was to interpret it.

Clear website content, precise explanations and properly evidenced recommendations helped customers understand the difference between general information and regulated advice.

Customers seeking an adviser by location, mortgage type or language could use the Connect Experts mortgage adviser directory. Advisers listed through the directory remain responsible for the advice they provide.

What did 2024 teach mortgage advisers?

The market recovered, but it did not return to the conditions seen before borrowing costs increased.

The strongest adviser businesses were not simply those that found a lower rate. They were those that understood affordability, monitored lender criteria and explained the complete borrowing position clearly.

This is where a mortgage network can provide practical value. Research support, compliance guidance, lender access and specialist placement services can help advisers respond when market conditions change.

Mortgage advisers considering network support can learn more about joining the Connect Network.

The lasting lesson from 2024 was simple: market movement creates information, but professional interpretation turns that information into a responsible mortgage strategy.