If you are a landlord who is keen to divest properties in view of upcoming legislation on the lettings sector, you might have been discouraged somewhat by other trends in the property sector. But one of these situations may be about to change significantly after the latest inflation figures made at least one, if not more, base rate cuts highly likely.

While both the old Conservative government and newly-elected Labour administration have been planning new rules many believe will load the law in favour of tenants and disadvantage landlords, the market for buying and selling properties has been in the doldrums over a couple of years.

Part of the reason for that has been the direct impact of the cost-of-living crisis in squeezing affordability, but the secondary consequence was the Bank of England’s response in raising the base rate 14 times, ending the era of cheap money characterised by a base rate below one per cent that had lasted since 2009, thus making mortgages much costlier.

This situation has eased somewhat, with the base rate being reduced from 5.25 per cent to five per cent in August in response to easing inflation, and there has been evidence of increased mortgage take-up, which is good news for sellers: The latest Halifax House Price Index data revealed 40 per cent year-on-year increase in mortgage deals agreed.

However, this news came with caveats: anyone wanting to make a profit on property investment should note recent price rises have only clawed back the falls of the last two years and Halifax head of mortgages Amanda Bryden warned that price rises were set to be modest over the coming months.

Secondly, a summer mortgage price war that had boosted lending has recently shown signs of ending, threatening to halt the recovery.

For that reason, news that the Consumer Price Index (CPI) rate has fallen to just 1.7 per cent may come as a very timely boost. It means the Bank of England could easily justify making more base rate cuts soon, bringing mortgage rates down again. Moreover, the easing of inflation means the wider squeeze on buyer incomes will have eased further.

All this means now could be a much more opportune moment for those selling up to contact estate agents and get those properties on the market.

The next base rate decision by the Bank’s Monetary Policy Committee (MPC) is due on November 7^th, so there will not be a long wait to see how the policymakers respond – followed by mortgage lenders once the decision has been announced.

At its last meeting in mid-September, the MPC voted 8-1 to maintain the present rate, but the minutes of the meeting showed they expected that the CPI rate would increase towards 2.5 per cent as the end of 2024 neared, a prediction that now looks highly unlikely.

Because of that, a radical shift may be expected and as mortgage costs fall, the property market recovery may gather momentum, creating a much more favourable climate for buyers and sellers alike than has been seen over the last couple of years.