THE PROPERTY FILTER TAKE
Demand for both house purchase and remortgaging rose in Q2 2026, per the Bank of England Credit Conditions Survey, but lenders expect both to fall in Q3.
Secured credit availability is forecast to increase in Q3 even as demand softens - a potential window for portfolio refinancing at less competitive conditions.
You may wish to review upcoming remortgage dates across your portfolio and speak to your broker about whether Q3 product availability changes your options.
Demand for both house purchase and remortgaging rose in Q2 2026, according to the Bank of England's Credit Conditions Survey published 2 July 2026. Lenders expect both to ease in Q3 - and for anyone managing a property portfolio, the timing of your next refinancing decision has just become more interesting.
What did the Q2 data show?
The Bank of England surveyed lenders between 26 May and 12 June 2026 and found demand for secured house purchase lending increased in Q2, alongside demand for remortgaging. Both moved in the same direction: up. At the same time, the availability of secured credit held unchanged - lenders did not widen their criteria, the market simply became more active within existing terms.
From a portfolio perspective, rising remortgage demand in Q2 signals that other investors and owner-occupiers were actively working their existing positions. If you held off refinancing earlier in the year, you were doing so in an environment where the pool of competing borrowers was growing. That is worth knowing when you think about your next move.
What does the Q3 outlook mean for your portfolio?
Lenders expect demand for both purchase and remortgaging to decrease in Q3 2026, according to the same Bank of England survey. That is a shift. What makes it more useful is the other half of the forecast: secured credit availability is expected to increase in Q3, even as demand falls.
If that plays out, the Q3 window could feature more products available and fewer competing borrowers - a combination that tends to benefit those in a position to act. Before drawing conclusions, run your current positions through Property Filter's stress test calculator to see which loans are worth prioritising. For a deeper read on how to structure your financing approach across a portfolio, the property investment strategies section covers the full picture over the cycle.
What does the defaults picture tell you?
Default rates on secured loans held unchanged in Q2 2026 and lenders expect them to stay stable in Q3, per the Bank of England survey. That is a broadly positive signal for residential investment. Borrowers are managing their secured debt, even with wider economic uncertainty in the background.
One figure worth noting: losses given default on secured loans increased in Q2 2026 (Bank of England, July 2026). When secured borrowers do default, lenders are recovering less. It is not a direct risk for a performing book, but it reflects lower collateral recovery - relevant if loan-to-value ratios across your portfolio have drifted since purchase.
Unsecured default rates rose in Q2 and are expected to rise further in Q3. Property investors are less directly exposed, but rising consumer credit stress does feed into tenant payment behaviour over time. Worth tracking alongside your rental income data. For context on how lender conditions are shaping the current market, the Property Filter negotiation and finance section covers active developments.
Key takeaways
• House purchase and remortgaging demand both increased in Q2 2026, per the Bank of England Credit Conditions Survey (July 2026)
• Lenders expect both to fall in Q3, while secured credit availability is forecast to increase - a possible refinancing window
• Default rates on secured loans were unchanged in Q2 and are expected to remain stable in Q3
• Losses given default on secured loans increased in Q2 - relevant for LTV-sensitive positions in your portfolio
• Unsecured default rates rose in Q2 and are forecast to rise further - monitor tenant payment trends
Demand for both house purchase and remortgaging rose in Q2 2026, according to the Bank of England's Credit Conditions Survey published 2 July 2026. Lenders expect both to ease in Q3 - and for anyone managing a property portfolio, the timing of your next refinancing decision has just become more interesting.
What did the Q2 data show?
The Bank of England surveyed lenders between 26 May and 12 June 2026 and found demand for secured house purchase lending increased in Q2, alongside demand for remortgaging. Both moved in the same direction: up. At the same time, the availability of secured credit held unchanged - lenders did not widen their criteria, the market simply became more active within existing terms.
From a portfolio perspective, rising remortgage demand in Q2 signals that other investors and owner-occupiers were actively working their existing positions. If you held off refinancing earlier in the year, you were doing so in an environment where the pool of competing borrowers was growing. That is worth knowing when you think about your next move.
What does the Q3 outlook mean for your portfolio?
Lenders expect demand for both purchase and remortgaging to decrease in Q3 2026, according to the same Bank of England survey. That is a shift. What makes it more useful is the other half of the forecast: secured credit availability is expected to increase in Q3, even as demand falls.
If that plays out, the Q3 window could feature more products available and fewer competing borrowers - a combination that tends to benefit those in a position to act. Before drawing conclusions, run your current positions through Property Filter's stress test calculator to see which loans are worth prioritising. For a deeper read on how to structure your financing approach across a portfolio, the property investment strategies section covers the full picture over the cycle.
What does the defaults picture tell you?
Default rates on secured loans held unchanged in Q2 2026 and lenders expect them to stay stable in Q3, per the Bank of England survey. That is a broadly positive signal for residential investment. Borrowers are managing their secured debt, even with wider economic uncertainty in the background.
One figure worth noting: losses given default on secured loans increased in Q2 2026 (Bank of England, July 2026). When secured borrowers do default, lenders are recovering less. It is not a direct risk for a performing book, but it reflects lower collateral recovery - relevant if loan-to-value ratios across your portfolio have drifted since purchase.
Unsecured default rates rose in Q2 and are expected to rise further in Q3. Property investors are less directly exposed, but rising consumer credit stress does feed into tenant payment behaviour over time. Worth tracking alongside your rental income data. For context on how lender conditions are shaping the current market, the Property Filter negotiation and finance section covers active developments.
Key takeaways
• House purchase and remortgaging demand both increased in Q2 2026, per the Bank of England Credit Conditions Survey (July 2026)
• Lenders expect both to fall in Q3, while secured credit availability is forecast to increase - a possible refinancing window
• Default rates on secured loans were unchanged in Q2 and are expected to remain stable in Q3
• Losses given default on secured loans increased in Q2 - relevant for LTV-sensitive positions in your portfolio
• Unsecured default rates rose in Q2 and are forecast to rise further - monitor tenant payment trends
Frequently asked questions
Frequently asked questions
What is the Bank of England Credit Conditions Survey?
Why do lenders expect purchase and remortgage demand to fall in Q3?
What does "losses given default" mean for a BTL investor?
When is the next Bank of England Credit Conditions Survey published?
