UK mortgage availability and demand experienced a decline in the third quarter of 2025, with lenders forecasting only a marginal improvement for the final three months of the year. This information comes from the Bank of England's Credit Conditions Survey.
The survey indicated that the availability of secured credit for households decreased in the three months leading up to the end of August 2025. Lenders are now projecting a slight increase in availability over the next three months, concluding at the end of November 2025.
Demand for secured lending for house purchases also fell in the third quarter, with a modest rise anticipated in the fourth quarter. Similarly, remortgage demand declined in Q3 but is expected to increase slightly in Q4, according to the Bank's figures.
This reduction in lending activity coincides with ongoing affordability challenges for buyers, particularly first-time purchasers. Recent analysis by Moneyfacts highlighted that fixed mortgage deals priced below 5% have largely disappeared, with a 99% reduction in such products within a single month.
Nathan Emerson, CEO at Propertymark, noted the encouraging signs of growing confidence regarding potential demand for secured lending in the coming months. Ryan McGrath, Director of Second Charge Mortgages at Pepper Money, observed caution on both sides of the market, with lenders reporting decreased availability and demand for both secured and unsecured credit to households in Q3.