Atom bank comments on ONS Private Rent and House Prices data

26 March 2025

Richard Harrison, Head of Mortgages at Atom bank:

“The increase reported by the ONS - the highest rate of annual growth since February 2023 - is a great snapshot of the start of this year, with buyers moving quickly out of the blocks in the race to beat the upcoming Stamp Duty deadline. This is borne out by figures from Rightmove, showing that the level of agreed deals is up by 9% on the same point last year. Even if the passing of the Stamp Duty deadline leads to a material drop in demand, the underlying lack of supply means prices are unlikely to drop at all over the coming months.

“Cheaper mortgage rates are playing their part, too. Moneyfacts reported significant momentum in rate falls across February, with two and five-year fixes dropping at the fastest pace in six months. With inflation coming in lower than expected, and the markets now predicting there will be two further base rate cuts this year - potentially from as soon as May - the prospect of mortgage rates heading below 4% will buoy buyers.

“However, if lenders are to meet that demand, they will have to be flexible with borrowers who fall outside the Prime category. The challenges of the last few years mean increased numbers of would-be buyers have less than spotless credit records, yet are more than capable of meeting the monthly mortgage repayments. It’s vital that they have access to competitive mortgages, and at high LTVs, if we are to have a housing ladder that functions properly.”