An investment platform says property investors have been buoyed by recent interest rate falls by lenders – even before next month’s Bank of England decision on its own base rate.
Caroline Marshall-Roberts, chief executive of BuyAssociation, says the flurry of lenders dropping their interest rates on residential and buy to let mortgages is a Sur sign that they believe change is on its way.
“Although the Bank of England held rates steady last month, its slow and well-thought-out approach has meant that lenders are responding to an overall trend and establishing a degree of predictability in the market. This means that investors can plan with more confidence now, knowing that they can make decisions without the immediate threat of rising costs and repayments” she states.
Her advice to investors is:
Reassess your financial position – With rates holding and more cuts potentially on the horizon, now is a good time to review your finances. If you’re on a variable-rate mortgage, consider switching to a fixed-rate deal. Locking in a lower rate can protect you from future increases and improve your cash flow forecasting.
Track inflation and economic forecasts – The base rate hold is promising, but it doesn’t guarantee future cuts. Keep a close eye on inflation and monetary policy signals; they’ll guide when easing may start and help you plan your next move.
Optimise what you already own – Rather than expanding your portfolio, focus on maximising returns from your current properties. This could mean refurbishments, improving energy efficiency, or enhancing tenant appeal, all of which contribute to more predictable income.
Explore lower-value investment opportunities – Consider properties in lower-cost areas or with smaller upfront investment needs. This approach can reduce borrowing and help protect your cash flow if rates increase again.
Keep rents competitive – Affordability is crucial for tenant retention. Pricing rent at a realistic, market-aligned level can help avoid costly voids and ensure consistent income, especially during economic uncertainty.
