There’s encouraging news for the property market as we move further into 2026 — particularly for first-time buyers. After a period of higher interest rates and affordability pressures, competition between lenders is beginning to reshape the mortgage landscape, bringing renewed confidence to those looking to take their first step onto the property ladder.
For buyers across Huntingdonshire, St Ives, Kimbolton and the surrounding Cambridgeshire villages, these changes could open up new opportunities in the months ahead.
Lenders Compete with Higher LTV Options
One of the headline developments this year is the launch of new higher loan-to-value (LTV) mortgage products aimed at first-time buyers. For example, Santander has introduced a 98% LTV five-year fixed mortgage at 5.19%, requiring just a £10,000 deposit.
While mortgage advice should always be sought from a qualified adviser, this type of product demonstrates growing confidence among lenders and a willingness to support buyers with smaller deposits. Other lenders are expected to follow with similar competitive options.
In practical terms, this could help more buyers move forward sooner, especially those who have struggled to build larger deposits in recent years.
Higher Income Multiples Expanding Borrowing Power
Some lenders are also increasing income multiples, with certain banks reportedly offering loans of up to six times a buyer’s salary. For those whose affordability has previously limited their property search, this could make a meaningful difference.
Combined with gradually easing mortgage rates, this shift may help more buyers secure homes that suit their needs, rather than compromising due to borrowing restrictions.
For local markets such as Huntingdon, St Ives and Kimbolton, this renewed borrowing capacity can support steady activity and sustained buyer interest.
Deposit Size Still Matters
Data from Moneyfacts highlights how deposit size continues to influence mortgage choice. Buyers with a 5% deposit now have access to hundreds of mortgage products, with rates typically ranging between 4.2% and 6%. Increasing the deposit to 10% significantly expands the number of available products, with some rates starting from around 3.78%.
Even a modest increase in savings can therefore unlock better rates and improved affordability.
For sellers, this is important too. A broader range of mortgage options often translates into a larger pool of motivated buyers.
The Growing Role of Family Support
Another noticeable trend in 2026 is the continued rise of the so-called “Bank of Family.” Parents and grandparents are increasingly helping younger generations by contributing towards deposits.
In some cases, this support comes from property wealth or equity release, enabling first-time buyers to reduce their loan-to-value ratio and access more competitive mortgage rates.
While financial advice is essential before making such decisions, family assistance is playing a growing role in helping buyers overcome deposit challenges.
Lower Monthly Payments Boost Confidence
For those considering buying in 2026, these changes create a more supportive environment than many have seen in recent years. Improved mortgage competition, greater product choice, and increased affordability all contribute to renewed confidence.
For sellers, this is equally encouraging. When mortgage accessibility improves, buyer demand tends to strengthen — particularly in desirable locations with strong schools, transport links and community amenities.
Across Cambridgeshire towns and villages, steady demand from first-time buyers remains an important driver of market activity.
Looking Ahead for First-Time Buyers
While national mortgage trends are positive, property decisions are always personal and locally influenced. Market conditions can vary significantly from one town to another, and understanding local pricing, demand levels and buyer behaviour remains key.
At Peter Lane & Partners, we continue to monitor both national developments and local market trends to support buyers and sellers throughout 2026.
With lenders competing more actively and affordability improving, the year has begun on a far brighter note for first-time buyers — and that optimism is filtering through the wider housing market.
