A more stable interest rate environment has helped calm fears about mortgage affordability according to latest property tracker data from the Building Societies Association. 

This regular survey found fewer homeowners are worried about being able to meet their monthly mortgage payments, and there has also been a drop in the number who see mortgage affordability as a barrier to home buying.

The tracker also found that the numbers of people expecting house prices to rise in the year is increasing, although the BSA said that while housing market sentiment is improving, it remains weak. 

Data from this property tracker shows that 9 per cent of respondents were either ‘not very confident’ or ‘not at all confident’ about paying their mortgage over the next six months. This is a decline in the 12% expressing these concerns six months previously in September 2023. 

Those who rent their home are a little less assured though, with just three-quarters (74%) confident about meeting their monthly rental payments. However, this is the highest confidence score since March 2022 — with the BSA noting with a corresponding decline in the number who said they were ‘not confident’ about meeting these payments.

The survey shows affording a mortgage remains the biggest barrier to buying a home. But this was now cited by 62% of respondents — a significant decline on the 71% recorded in September.

The report also revealed that other perceived barriers to home ownership also appear to be diminishing. Fewer people cited concerns about future falls in property prices as a potential barrier — figures were down from 18% to 12%. This is the lowest level it has been for eight years.

However raising a deposit remains a significant barrier to buying a home, cited by 60% of respondents. This remains virtually unchanged since December last year.  

The tracker found that 41% of people expect house prices will rise over the next 12 months — a significant increase from 33% in December 2023. The BSA says this is the highest proportion expecting a price rise since June 2022. 

There was a corresponding shift in those expecting house prices to fall in the next year, with only 14% believing this to be the case, compared to 24% in December.

Overall the BSA says this tracker shows that sentiment in the housing market remains weak, but has improved since December. 

The proportion of people who think now is a good time to buy a property is 19% compared to 16% in December 2023. This is the highest it has been since December 2021.

BSA head of mortgage and housing policy Paul Broadhead says: “The overall reduction in mortgage rates following the peak in 2023 has been welcomed by homebuyers, and has seen an improvement in confidence in the housing market.

“While consumer prices remain high, wage growth has been strong meaning many households are now in a stronger position than six months ago. There is also an expectation that if inflation continues to fall, the Bank Rate may be cut this year, further easing pressures on borrowers and increasing mortgage affordability.

“Whilst affordability of mortgage payments remains the biggest barrier to house purchase, it is reassuring that this has reduced over the past six months. Expectations around house prices reflect this more stable outlook for the housing market.

“Whilst there has been a welcome reduction in those that are concerned about meeting their mortgage payments, lenders remain very aware that there are a number of homeowners who are struggling.”