Momentum in the mortgage market is expected to continue into the first half of the year, with approvals for both house purchases and remortgaging projected to climb, based on new analysis by Alexander Hall.

The brokerage reviewed historic data from the Bank of England, examining average monthly approval levels for house purchases and remortgaging over the past three years.

It has also produced forecasts for the first two quarters of the year, citing recent base rate movements and relative market stability as supportive factors.

HOUSE PURCHASE APPROVALS

According to the analysis, average monthly approvals for house purchases have risen steadily since 2023. That year recorded an average of 48,088 approvals per month.

In 2024, this increased to 62,876 per month, before rising again to 64,164 per month in 2025.

Although activity softened during the fourth quarter of last year, which the firm attributes largely to seasonal factors, it expects that slowdown to unwind over the coming months.

For the first quarter, Alexander Hall estimates that average monthly house purchase approvals will increase by 1% per month, reaching 62,286 on average. A further 1% monthly rise is forecast in the second quarter, taking average approvals to 64,196 per month.

The figures suggest that, while growth is modest, the direction of travel remains positive, with activity broadly holding at levels above those seen in 2024.

REMORTGAGING ACTIVITY

The recovery in remortgaging is projected to be more pronounced. Average monthly remortgage approvals stood at 29,658 in 2023 and rose slightly to 30,492 in 2024. In 2025, that figure increased more markedly to 36,747 per month.

Looking ahead, the firm expects a stronger uplift as borrowers reach the end of fixed-rate deals taken out during the period of higher rates and seek to refinance in a more competitive environment.

For the first quarter of 2026, average monthly remortgage approvals are forecast to reach 41,547, representing a 5.4% increase in the average monthly rate of growth compared with the previous quarter. In the second quarter, approvals are projected to rise by a further 3.5% on average per month, reaching 48,257.

While forecasts remain subject to wider economic conditions, the projections indicate that remortgaging could outpace house purchase growth over the coming months, reflecting the volume of borrowers coming to the end of fixed terms.

Richard Merrett, managing director of Alexander Hall, said: “Over the last three years we’ve seen a clear strengthening of mortgage market activity, both from those purchasing homes and those remortgaging and, while seasonal fluctuations remain a natural part of the cycle, the underlying trend is one of resilience and strength.

“With competitive rates and lenders continuing to enhance both their product range and affordability criteria, we expect this positive momentum to continue through the first half of the year.

“It’s not just homebuyers who are benefitting, borrowers approaching the end of their fixed term are increasingly recognising that conditions are more favourable than they were 12 to 18 months ago, and that is feeding through into higher levels of activity.”