Kind of. Handguns are illegal, but rifles and shotguns, while strictly controlled, are still legal to own if you have a license. There are 2 million legal privately-owned guns in the UK.
The guns the police found at this guy’s house were “air weapons”, in other words BB guns, which are pretty much unregulated if you’re an adult.
Not sure if there was any truth to the gunpowder charge, or what he planned to do with it if there was. Might have just been for fun (making his own fireworks), but given the risks involved it’s reasonable for it to be illegal to make gunpowder at home…