Budget 2026: what UK housing needs (and doesn’t)

Well, here we are again: another budget looming. And both the electorate and contractor industry have their fingers crossed for October 28th. The housing market does too. Okay. Maybe all three aren’t going to the effort of crossing their toes. In an age where we now know chancellor set pieces must be realistic, hopes for Budget 2026 aren’t quite that high.

What is the UK housing market expecting from John Healey?

To be honest, 22 years specialising in the UK mortgage market tells me most of the housing announcements have already been made, writes John Yerou, CEO of contractor mortgage broker Freelancer Financials.

Contractors and the self-employed might assume otherwise, but lenders really are bending over backwards to make buying a home more accessible.

So, first, I want to reveal how contractor mortgage lenders, building societies and the government are already making home loans easier to access for flexible and contract workers. Then I’ll get to my Budget 2026 wish, in the hope that chancellor Healey can play genie for the housing market. Then I’ll end with why even all of us rubbing every lamp we can find this autumn won’t be enough to grant that wish.

Key takeaways

• Lenders loosened up in Q3: 1% deposit mortgages, income multipliers up to 6.5x income, and approvals of multi-client contractor (‘fractional worker’) income.
• Government has committed £16bn to social and affordable housing — but only 11% of renters aged 20–44 in England can currently afford to buy.
• What Budget 2026 (on Oct 28th) needs to contain for UK housing: Reinstate Stamp Duty relief. It’s the single biggest lever left for first-time buyers and downsizers.
• What Healey mustn’t do for homeowners: repeat the 2022 mini-budget. Not because it moved to axe IR35 reform, but because markets today need calm, not shocks.

What lenders are doing to make buying a home more accessible

We know the score: contractors, the self-employed and entrepreneurs often get a rough ride when they try to ‘go direct’ by approaching a high street lender. For proof, read the section of Mazuma founder Lucy Cohen’s blog entitled “And no, you may not buy a house.”

So, it’s a fair question: how exactly are lenders making the housing market more accessible for this enterprising group?

There are four key areas:

1. ‘Blended’ mortgages

   Lenders are increasingly offering ‘blended’ mortgages, where homeowners repay part of the capital and part of the interest each month, rather than committing fully to one or the other.

2. 1% deposit mortgages

   Mortgage lender Accord, which is a part of Yorkshire Building Society, is offering a new mortgage that asks for just a £5,000 deposit for up to £500,000 borrowing for first-time buyers. At the time of writing (Friday September 4th 2026), more than 2,500 borrowers have already taken up Accord’s ‘One per cent mortgage’ offer.

3. Increased income multipliers

   Go back to the immediately post-pandemic mortgage market, and the highest income multiplier you could get was 4.5, maybe 5.0 at a push. As of September 2026, if your borrower profile as a contractor is spotless, you can get up to 6.5x your annual income to buy a home.

4. Blended income (‘fractional’ professionals)

   This is the one that will attract contractors the most. Recently, our brokerage has been able to convince underwriters that contractors who flip between PSC (Personal Service Company), umbrella company, and PAYE employment are simply going where the market takes them.

   That’s fine. Lenders are getting on board with that.

What about ‘fractional’ professionals and mortgages?

Fractional professionals or leaders tend to have expertise that allows them to work multiple contracts at the same time. They often secure high-level, influential roles — think fractional or interim CTO positions — that an organisation doesn’t think justify a full-time consultant or C-suite hire.

And these types of fractional jobs are now going to contractors. With uncertainty squeezing recruitment budgets, we’ve mortgage-enabled contractors who work five days a week, but for three different clients. Maybe two days at one, two at another, and a day at a third.

You won’t currently find a lender advertising its lending criteria for this type of fluctuation. So ‘fractional’ mortgage applicants are yet to get their own pamphlet. But thanks to our contacts in senior underwriting teams, we are getting mortgages for professionals with this type of complex income ‘across the line.’

On the surface, it might look like mortgage lenders are just going where the market takes them — rates alone are hard enough to predict from one week to the next. But in the contractor space, lenders are innovating in these four ways. And long may it continue.

What is Andy Burnham’s government already doing on housing, pre-Budget?

Andy Burnham made no secret of his social housing program in the run-up to his ascension to the premiership — which was formalised on July 20th when he became PM.

Late last month (August 2026), his government put some flesh on those bones.

In the West Midlands and across the north, the government sanctioned £10bn for 70,000 social and affordable homes. A further £6bn was earmarked for London.

Why affordable housing matters for aspiring homeowners

Contractors might ask, “What has this £10bn for social homes got to do with homeownership?”

Fair question.

One of the biggest barriers to getting onto the property ladder right now is the crippling rent would-be homeowners pay to private landlords — affordable and social housing would ease that burden and lower the entry point to saving for a deposit.

What does the data say about Britain’s housing ladder gap?

And this is not just supposition or theory!

• A Yorkshire Building Society survey (“No Way Home?”), run between March 30th and April 15th 2026, found that only 11% of renters aged 20 to 44 in England are in a position to buy.
• A Skipton Building Society index published in July 2026 indicates that this gap in aspiration versus reality is both huge and growing, as the average age of first-time buyers in England before the covid pandemic was 32, compared with 34 today. In London, the average age is 35.

So, great. Bring on affordable and social housing. But the government can go further.

My one housing wish for Budget 2026 as a mortgage expert

What I, and almost everyone in the mortgage market, want to hear on October 28th is the chancellor reducing the tax and cost burden of buying a home — particularly Stamp Duty.

Officially called Stamp Duty Land Tax, or SDLT, Stamp Duty is such an influential factor, especially for first-time buyers and older buyers looking to downsize.

We’ve been asking for a Stamp Duty intervention for years. But cash grabs to service the country’s debt seem to have taken priority when previous chancellors got to their feet.

Removing Stamp Duty relief at their first budget was just one way the Labour government sought to balance the UK’s borrowing deficit. The knock-on effect has been brutal.

Why a flat housing market costs more than just homebuyers

Here’s another thing. If the housing market is flat, then self-employed ‘trades’ are losing out in their sector of the supply chain. As a consequence, HMRC misses out on subsequent income tax. Then, GDP suffers.

Why can’t those in power see that?

Yet, in all honesty — what with the conflicts in the Middle East and Ukraine, and other global uncertainty — I don’t hold out much hope that John Healey will grant me my wish for SDLT relief to be reintroduced 51 days from now, even though he was briefly the minister for housing (June 2009-May 2010).

The absolute imperative

But here’s one thing we definitely don’t want to see at the end of next month: a Liz Truss 2.0 Budget.

As our head of mortgage sales, George Yerou, succinctly put it when I mentioned penning this article for ContractorUK on UK housing and my wish to Healey:

“The new chancellor cannot afford to spook the markets.”

For both us and the contractors whose mortgages we’ve arranged since 2004, we want Autumn Budget 2026 to bring stability to the UK — not one that crashes bond markets, as the Truss-Kwarteng budget did in September 2022. Even though it admirably moved to repeal IR35 reform, mortgage interest rates have never really recovered since the rest of their fiscal package was announced in the House of Commons. And, as I’ve already alluded to, rates remain dynamic as lenders try to gauge the housing market.

Buyers need confidence before committing to the biggest financial outlay that they’re ever likely to make, and that’s true for contractors too. Neither they nor the chancellor can afford to gamble right now. So, let’s leave the spooks for Halloween, eh?

Budget 2026: Housing FAQs

Q: When is the UK Budget 2026?
A: Chancellor John Healey delivers Budget 2026 on Wednesday October 28th 2026, just a few days before Halloween.

Q: Is Stamp Duty changing in 2026?
A: Reinstating Stamp Duty relief is the housing sector’s top ask of chancellor Healey, but Freelancer Financials doesn’t expect the new chancellor to grant it amid wider fiscal pressures.

Q: Are mortgages for contractors and the self-employed being made more accessible?
A: Yes, lenders are now offering 1% deposit mortgages, income multipliers up to 6.5x income, and increasingly accept multi-client ‘fractional’ income, but going direct to a high street lender remains difficult for contractors and entrepreneurs.

Q: What is the government already doing on housing ahead of Budget 2026?
A: It has committed £16bn to social and affordable housing — £10bn for 70,000 homes across the West Midlands and the north, and £6bn for London.

Q: Has chancellor Healey worked on housing policy before?
A: Yes, he was UK housing minister from June 2009 to May 2010 (under the Gordon Brown-led Labour government).

Q: What doesn’t the housing sector want most from Autumn Budget 2026?
A: Repeating the market-rattling 2022 mini-budget, even if it did move to repeal IR35 reform.