Here’s one that slipped under the radar a bit, but could turn out to be pretty significant over the medium to long term.
It could be one of the things that helps push property prices higher over the next few years.
Back in March 2025, (ok, I know that sounds like ancient history, but no one really talked about it, and it is important) the FCA reminded lenders that they already had some flexibility in how they apply mortgage affordability stress tests. In plain English, that means they do not always have to keep using a very blunt “what if rates shoot up” approach in exactly the same way. For fixes of less than five years, lenders only have to consider likely rate rises over the length of that deal. And if the rate is fixed for five years or more, no stress test is required at all. The FCA also said many firms had been using unnecessarily high tests which could restrict access to otherwise affordable mortgages.
That may sound technical, but the practical point is simple enough.
If lenders can be a bit less conservative, some borrowers can borrow more.
And that is where it gets interesting.
Savills says this one change could increase first-time buyer transactions by roughly 14% to 24% over the next five years. It also says this could add an extra 5% to 7.5% to house prices on top of its existing five-year forecasts, depending on how much of that extra borrowing power gets passed through into prices.
So, on one hand, more people may be able to buy.
On the other hand, the very fact they can buy may help push prices higher.
Classic supply and demand.
More mortgage approvals, or at least more borrowing power, chasing the same amount of stock usually means upward pressure on prices.
In other words, a glass-half-empty person could argue that making mortgages easier to get may end up partly cancelling out the benefit, because prices then rise in response.
Which is, frankly, a very property-market sort of outcome.
Savills also makes the point that this would not happen overnight. It sees the impact building over a five-year period, and says the scale of it will depend on how much extra housing stock is actually delivered to meet the extra demand.
So how does this affect buy to let?
Directly, not that much from this specific FCA clarification, because this is mainly a residential mortgage story.
Indirectly, it could matter quite a bit.
If you already own property, rising values would obviously be no bad thing.
If you are trying to buy, especially in areas where first-time buyers are active, you may find yourself paying more.
And that is the bit investors should not ignore.
Because even when a policy or rule change is not aimed at buy to let, it can still affect the market buy to let investors operate in.
The other reason it matters is sentiment.
The FCA has since said that around 85% of the market updated its approach after the March 2025 clarification, and that lenders are now able to offer around £30,000 more in some cases. That tells you this was not just a theoretical tweak buried in a rulebook. The market actually responded to it.
So yes, on balance, I do think this could help support higher house prices over time.
Not because it changes everything overnight.
But because widening borrowing capacity in a market that is still short of decent stock tends to push in one direction more than the other.
Up.
Unless, of course, the wider economy goes properly down the pan.
Because if that happens, a helpful tweak to affordability rules will not magically rescue the market on its own.
As ever, this is not advice. Don’t drawdown loans or mortgages without taking advice from a good mortgage broker. If you don’t have a mortgage broker, or you’d like a second opinion, I’ll be happy to introduce you to mine. Just email me at
and I’ll make the introduction.
Here’s to successful property investing.
Peter Jones
Author, property investor and ex-Chartered Surveyor
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