Are mortgage rates coming down in early 2026?

Momentum is moving in the right direction. HSBC has already cut mortgage rates in early January 2026, and that tends to push other lenders to respond. The Guardian

Even so, the best deals depend on your deposit size, your credit profile, and whether you are buying, remortgaging, or investing.

Which bank has the best mortgage rate right now?

For buyers with a large deposit (60% LTV), one widely reported headline best buy is:

Santander, 2-year fixed at 3.55% (60% LTV), fee £749 HomeOwners Alliance

That said, “best” always depends on the total cost. A slightly higher rate with a lower fee can work out cheaper, especially on smaller loan sizes. Rates also change frequently, sometimes daily.

What this means for buyers in London

Lower rates can improve affordability, and they can also bring more buyers back into the market. As a result, well priced homes in popular commuter areas can attract stronger interest, even when the wider economy looks uncertain.

If you plan to buy in 2026, focus on three things:

Your deposit and loan to value (LTV), because it heavily influences your available rates.
Your monthly payment comfort zone, so you avoid stretching.
Your mortgage term and fixed period, because stability can matter as much as the headline rate.

What this means for landlords and the rental market

When borrowing costs ease, some landlords can refinance on better terms. At the same time, rental demand in London can stay strong when first time buyers delay purchases and keep renting. The result is simple, mortgage shifts can ripple into rental supply and pricing, particularly in high demand zones across East and Central London.

Quick savings snapshot, if you are comparing mortgage versus saving

If you meant savings rates rather than mortgages, several best buy round-ups show easy access savings up to 4.5% AER, with Chase often leading via a boosted offer for eligible new customers. MoneySavingExpert.com+2Chase UK+2

The Primeland Property view, what to do next

If you are buying, remortgaging, or investing in London, you should track rates, but you should also focus on the full picture, deposit size, fees, affordability, and timing.

For property advice and viewings, contact Primeland Property on 0207 377 5445, or visit our office at 124 Whitechapel Road, London, E1 1JE.

References

Bank of England, official Bank Rate data and base rate reporting. Bank of England+1
MoneySavingExpert, base rate cut explainer and savings rate context. MoneySavingExpert.com+1
HOA best buy summary for headline mortgage deals. HomeOwners Alliance
The Guardian, HSBC rate cut coverage (January 2026). The Guardian
Chase UK, boosted saver product page. Chase UK