Buyers are still cautious as storm clouds hover over the economy
The Iran conflict has cast a long shadow over the UK property market, turning what had been a confident start to 2026 into a period of hesitation and caution.
The year had opened on a genuinely optimistic note. Lenders were already reacting to expectations of Bank of England base rate cuts, bringing rates down with some pace, and buyers were beginning to move with renewed confidence. Then March arrived and, with it, a sharp shift in the global picture.
"The year was looking really positive until March," said Charles Calvert (pictured top), managing director at Easy Mortgages. "That's when Donald Trump started the whole thing with Iran and it's just had a massive impact. Everyone was expecting the rates to come down. People were getting really excited, the market was looking great, and then suddenly things changed and rates went up by around 1%."
A market in wait-and-see mode
The ripple effects have been significant. Oil prices, energy costs, and inflation expectations are all now bound up in the uncertainty surrounding the conflict, making for a difficult environment for the Bank of England to navigate. While rate cuts had seemed probable at the start of the year, Calvert now believes the Monetary Policy Committee could hold or even increase rates before conditions improve.
Domestic political uncertainty is compounding the mood, with questions about the direction of the Starmer government adding another layer of noise for buyers already contending with elevated borrowing costs. For Calvert, the practical impact has been visible on the ground, with May noticeably quieter than the same period last year.
"A lot of people are watching this space," he said. "They’re a bit concerned about high rates, what's happening in the market, and maybe some people that would move are now a bit more tentative."
Why waiting may cost more than it saves
For buyers sitting on the sidelines in the hope rate relief will arrive before they commit, Calvert warned it can be a false economy. As rates improve, he said buyer demand surges back, competition intensifies, and house prices follow. A borrower who holds out for a lower rate may find themselves paying significantly more for the same property or losing it to another buyer entirely.
"There isn't a perfect time," Calvert said. "I would base it not on the interest rate you're getting, but whether this is affordable, and does this make my life better?"
The value of a good broker
For those who do proceed, Calvert stressed the importance of working with an experienced broker throughout, not just at the point of application. A typical purchase takes three to four months to complete, and in a volatile rate environment, that window matters. A broker can update a rate between offer and completion, meaning a client who starts at 5.2% might finish considerably lower if market conditions improve in the interim.
"If you just decide ‘I'll do it myself,’ you can really end up getting declined when you could have got an accept elsewhere, or get a much worse interest rate than you could have got elsewhere," said Calvert.
The same applies to remortgages and product transfers, where locking in early – up to four months ahead – can make the difference between securing a competitive deal and missing the window altogether. With rates still in flux and the outlook uncertain, Calvert said having someone who knows the market and can act quickly is more valuable now than ever.
Reasons to be optimistic
Despite the current caution, Calvert remains optimistic. With news emerging of progress towards a deal with Iran, the reaction in oil markets was immediate. He sees that as a potential turning point.
"It just needs confidence," he said. "As soon as that confidence returns and there’s a bit more certainty, the markets will recover, people start moving house again, interest rates come down, and everything's good again."
Calvert’s outlook for the year remains upbeat. "We had a great start, and I think we're going to have a great finish. This is just a bit of an uncertain, tentative middle bit."
