A leading UK property expert says the recent Bank of England interest rate cut will bring a welcome lift to housing affordability—but warns that a shortage of available homes continues to constrain the market.
Mish Liyanage, CEO of The Mistoria Group, shared his expert view following the Bank’s decision to lower interest rates for the first time in over a year.
“With mortgage rates easing, we can expect a noticeable improvement in affordability, especially for first-time buyers who have struggled with higher borrowing costs,” said Mr Liyanage. “However, without an increase in housing supply, price pressures will remain.”
How the Interest Rate Cut Impacts Buyers, Landlords and Investors
Lower interest rates usually boost buyer confidence and stimulate demand across key northern markets such as Manchester, Salford, and Liverpool—areas known for strong capital growth and high rental yields.
“Cheaper borrowing will certainly help buyers and investors,” Mr Liyanage explained. “But the UK housing market still faces a fundamental issue: a chronic shortage of homes.”
Recent government figures show that only 124,000 new homes were built in England in 2024—almost 30 per cent below the annual target of 300,000. This persistent undersupply continues to drive both house prices and rental costs higher nationwide.
Opportunities for Landlords and Property Investors
Falling interest rates could translate into higher profitability for landlords, particularly those investing through limited company structures—which now account for over 70 per cent of all new buy-to-let purchases.
“Incorporating your property portfolio allows you to retain full mortgage interest relief and scale more efficiently,” said Mr Liyanage. “But investors must also prepare for upcoming Renters’ Rights Bill regulations that will reshape the private rented sector.”
Expected to take effect in 2025, the Renters’ Rights Bill will introduce major reforms such as periodic tenancies, a national landlord register, stricter eviction rules, and enhanced tenant protections.
“While lower borrowing costs are positive, landlords must stay compliant with new legal and licensing requirements,” Mr Liyanage cautioned.
Regional Variations Across the UK Property Market
Despite renewed optimism, market recovery will vary regionally.
“Demand is rebounding fastest in northern cities and university hubs, whereas regions with weaker employment or ageing housing stock are slower to respond,” Mr Liyanage observed. “Astute investors are focusing on growth areas with strong infrastructure projects, vibrant student populations, and thriving local economies—locations where rental yields of 7–8 per cent are still achievable.”
Mish Liyanage’s Five Expert Tips for Navigating the Post-Rate-Cut Market
- Act Fast – Take advantage of lower borrowing costs before heightened demand pushes prices higher. Post-cut markets typically see faster transactions and greater competition.
- Work with Local Experts – Partner with experienced estate agents who understand regional trends and off-market opportunities. Local insight is key to reducing risk and maximising yields.
- Prioritise Compliance – Stay ahead of Renters’ Rights Bill requirements and HMO licensing rules to avoid fines, rent-repayment orders, or licence suspensions.
- Consider a Limited Company Setup – This structure can improve tax efficiency, preserve mortgage interest relief, and streamline portfolio expansion.
- Monitor Market Data – Regularly review government housing statistics, planning approvals, and employment trends to identify undersupplied, high-growth areas with strong long-term investment potential.
The Bottom Line
The Bank of England’s interest rate cut represents a timely boost for UK homebuyers, landlords, and investors, easing mortgage pressure and supporting renewed activity.
However, the housing supply deficit remains the most significant challenge, sustaining competition and keeping both prices and rents elevated.
The Mistoria Group continues to report strong buyer and investor demand across the North West, where rental yields and capital appreciation remain among the strongest in the country.
Get Professional Property Investment Advice
For personalised guidance on buy-to-let strategy, property compliance, or portfolio growth, contact The Mistoria Group today.
📞 0800 500 3015 | 📧 info@mistoriagroup.com
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