Mortgage market update | February 2026

The first month of 2026 is already done and it has been a busy start. From my side, I am seeing a lot of clients planning their next move, whether that is moving to something bigger or just a new location.

The New Year usually brings a rush, but (and maybe this is just me being the eternal optimist) this year feels a bit different. Lenders have started the year with a price war and some options are now as low as 3.5%. This is the lowest we’ve seen since the whole Truss/Kwarteng debacle, and it’s providing a much-needed shot of confidence to the market.

The "Rightmove Jump": Market Realism vs. Ambition

I’ve been reading the latest Rightmove report, and there are some key takeaways that echo what I’m seeing on the ground. There has been a record 2.8% jump in new asking prices this January. While that shows massive seller confidence, there’s a bit of a balancing act going on.

• For Buyers: If you are a first-time buyer, my advice is not to wait for Spring. With more properties coming on and rates looking better, I would be looking at options today and trying to secure a property before it gets even more competitive.

• For Sellers: It is tempting to feel your home is the best on the street, but remember that buyers have a lot of choice right now. A third of homes currently for sale have already had to reduce their original asking price.

• The Sweet Spot: You need to strike a balance between your price ambition and market realism. In London, it is currently taking about 87 days to secure a buyer, so getting the price right from the start is the best way to get moving.

You can read the latest report here.

The 6x Income Boost

Competition is picking up, which is good news for your borrowing power. Several major lenders have now enhanced their Loan-to-Income (LTI) limits to help customers borrow more:

• NatWest: They are the latest major lender to offer up to 6x income. Effective for new applications submitted from January 28th, these new enhancements specifically apply to capital and interest (repayment) mortgages:

  
  

  • High Earners: Sole applicants earning £75k+ or joint applicants earning £100k+ can now access 6.0x income (up from 5.5x) for LTVs of 75% and below.

  • Mid Earners: Sole or joint applicants earning £40k+ can now access 5.5x income (up from 5.0x) for LTVs of 75% and below.

  • The Impact: A customer earning £75,000 a year could now potentially borrow up to £37,500 more under these updated calculations than they could before this change.

• Bank of Ireland: They have joined the banks offering a 6x income multiple through their Bespoke range. You need a minimum income of £50k for a single applicant or £75k for joint, but it is a great boost to get you further.

  
  

• Nationwide: They have expanded their 6x lending. This is now available for home movers or those remortgaging with additional borrowing. Here are two examples of how much of a difference this makes:

  
  

  • Single applicants on £75k can now borrow up to £450,000 (an extra £37,500).

  • Joint applicants on £100,000 can now borrow up to £600,000 (an extra £50,000).

Flexibility with Interest Only

Principality Building Society has followed other lenders by increasing their interest-only options. They have moved to a maximum of 75% LTV, provided you have £150k in equity and a max term of 25 years. It is great to have another lender offering this flexibility for clients who want more control over their monthly cash flow.

My Final Thought

While most of this is positive, some banks have increased rates slightly this week. As I always say, if you are on the fence waiting for a perfect deal that might never arrive, you might miss out on what is available right now.

Risk warnings

Your home may be repossessed if you do not keep up repayments on your mortgage