Rent and mortgage spending increased slightly to 2.0% year-on-year in January, according to the latest Barclays Property Insights report.
Despite this increase, consumers’ confidence in their ability to afford rent and mortgage payments remained unchanged month-on-month at 52%.
Anticipating the Bank of England’s (BoE) recent decision to cut the Base Rate, consumer concerns around rising interest rates dipped slightly to 61%, down from 62% in December.
Confidence in the UK housing market reached a six-month low of 24% as buyers contend with rising housing prices and upcoming Stamp Duty changes.
Half of renters (51%) reported property prices as a main barrier to owning a home, up 11% from December.
Similarly, 44% said the cost of a deposit remains a major blocker, up from 37% in December.
However, renters were still hopeful despite rising costs, as 23% believed that homeownership would be within their reach within the next five years, with three in 10 currently saving for a deposit (31%).
Despite declining confidence in the housing market, many were still hopeful that housebuilding is the solution.
Two-thirds (65%) said that new-builds were necessary to provide more housing in the UK, and 42% said that new-build developments create a halo effect for communities, bringing economic benefits to the area.
More than two-fifths (42%) of adults said they would consider buying a new-build, rising to over half of 18 to 34-year-olds (52%).
Compared to over-55s, younger generations were three-times more likely to consider new-builds better value for money than existing properties (34% of 18 to 43-year-olds, versus 11% of 55+).
Regionally, people from Northern Ireland (55%), London (51%), and the West Midlands (46%) would be most willing to buy a new property.
Three in 10 homeowners (28%) said they had previously purchased a new-build property.
The main factors influencing their decision were: that it was new (51%), desired location (51%), lack of property chain (38%) and modern features (35%).
Sian McIntyre, managing director of mortgages and savings at Barclays, said: “The start of 2025 saw a slight increase in mortgage and rental spend, though encouragingly this hasn’t knocked consumers’ confidence in their ability to make payments.
“This month’s reduction in the base rate was a further signal that we’re headed in the right direction.
“Housebuilding is increasingly a focus, with the nation’s outlook on new developments pragmatic, recognising the necessity for new builds as part of the solution to increase housing supply, as well as the advantages they can bring to both homeowners and communities.
“Ahead of April’s looming Stamp Duty changes, prospective buyers will continue to look for ways to pair aspiration and affordability, with energy efficiency a clear priority when choosing the right home.”
