There is a long-held view that governments rarely learn from their mistakes, particularly when it comes to how they handle fiscal events and the signals they send to markets. In housing and mortgages, that perception has often felt justified.
Last year’s Budget provided a good example of how easily uncertainty can be created when speculation is allowed to build ahead of a major announcement. For weeks, even months, before the event the market was filled with rumours about potential changes to housing policy, tax and property. None of this was confirmed, yet the absence of clarity allowed gossip to fill the gap.
The consequences were predictable. Buyers paused, sellers hesitated and many transactions slowed to a complete halt as people waited to see what the Budget might contain. In a market that relies heavily on confidence and momentum, that uncertainty effectively placed parts of the housing transaction market on hold.
That is why the handling of this year’s Spring Statement deserves attention.
A calmer run up to the Spring Statement
From the outset the government made it clear the Spring Statement was not intended to be a policy-heavy fiscal event in the way a Budget normally is. Expectations were set early and, importantly, there was little of the rumour-driven atmosphere that surrounded the previous Budget. Praise be.
For sectors like housing, mortgages and those ancillary ones related to them, this matters more than many outside the industry appreciate. Property transactions take time, they require commitment and involve multiple parties. When the possibility of policy change hangs over the market, people often prefer to wait rather than act.
This time, that atmosphere never really developed. The absence of speculation meant advisers and their clients could focus on real decisions rather than hypothetical policy changes that might appear in a speech weeks later. If the lesson from last year was that rumour and uncertainty can stall activity in the extreme, then the calmer lead up to the Spring Statement suggests that lesson may have been taken on board.
What the housing forecast tells us
Which leads us to the Statement and the Forecast itself, with the Office for Budget Responsibility (OBR) reinforcing the picture of a housing market that is expected to remain steady rather than spectacular. House price inflation is expected to average just over 2.5% across the forecast period, broadly in line with income growth. That implies a market where prices rise gradually rather than accelerating sharply.
At the same time, mortgage costs remain a central feature of the outlook. The average effective interest rate on the current stock of mortgages is expected to rise from around 4.1% this year to roughly 4.5% across the rest of the forecast period. Even though that figure is slightly lower than previously expected, it still represents a significantly higher borrowing environment than the one many borrowers became used to during the previous 10-15 years.
Supply is also expected to shift over time. Net additions to the housing stock are forecast to fall to around 220,000 in 2026–27 before rising to just over 305,000 by 2030–31 as planning reforms are assumed to take effect. Meanwhile, housing transactions, which rose to around 1.2 million in 2025, are expected to grow gradually to roughly 1.3 million by 2030. These forecasts point to a housing market that continues to function and grow steadily.
The opportunity for advisers
In a market where mortgage rates average around 4.5%, the adviser’s role becomes even more important. Borrowers refinancing or purchasing property are likely to be facing higher monthly costs than they perhaps anticipated when they first entered the market.
Advisers of course can help manage that reality by focusing on the full structure of the mortgage rather than the headline rate alone. Product features, lender criteria, term length and repayment options can all influence affordability and long-term financial planning.
The advice conversation should also extend beyond the mortgage itself. Protection, income cover and general insurance become even more relevant when household budgets are under pressure and financial resilience matters more than ever.
There is also the broader cost of moving home. Conveyancing fees, insurance products and other transaction-related expenses can quickly add up. Advisers who help clients manage these costs effectively deliver value that reaches far beyond the mortgage product.
A reminder about market volatility
One thing we should not forget in the context of the now, is that forecasts are created at a particular moment in time. Events outside the UK economy can shift expectations quickly and alter the path of interest rates or inflation. Recent geopolitical tensions in the Middle East and the escalation of conflict with Iran have already demonstrated how fragile economic assumptions can be.
In February there was strong confidence that base rate reductions would arrive soon and potentially several times during the year. That certainty has already weakened. Energy markets, inflation expectations and global financial conditions can all move rapidly when geopolitical tensions rise. Mortgage pricing often reacts to these changes well before official policy decisions are made. For borrowers and advisers alike, this underlines how quickly the environment can change.
Busting the myth
The idea governments cannot learn from their mistakes is easy to repeat, but the way this Spring Statement was handled suggests the reality may be more complex. By avoiding the rumour-driven atmosphere that surrounded last year’s Budget, the government allowed the housing market to continue operating without unnecessary speculation.
That alone demonstrates how communication and expectations can influence market behaviour. For advisers, however, the more important message lies in the wider environment. Mortgage costs remain higher than many borrowers are used to, price growth is expected to remain modest and global events continue to introduce volatility.
In that context, advisers who provide steady guidance, take a holistic view of household finances and help clients manage the broader costs of property transactions will continue to play a vital role. Markets may change quickly, but the value of calm, informed advice does not.
