Improved liquidity is key to improving lending in the UK mortgage market, not interest rate cuts, it has been suggested.

Gary Smith, vice president of the National Association of Estate Agents (NAEA), believes no difference will occur even if the base rate falls to zero per cent.

His comments come after the Bank's monetary policy committee today voted to reduce interest rates by 50 basis points to 0.5 per cent.

Although private landlords with variable rate buy-to-let mortgages will continue to benefit from reductions in the base rate, some might be struggling to access deals after the number of products on the market has fallen.

Mr Smith acknowledged that rate cuts have lowered mortgage repayments for some property owners, but added that they have done little to improve lending.

"What we need is an increase in the number of mortgages available at sensible rates with limited deposits,"the NAEA official said.

Meanwhile, Michael Coogan, director general of the Council of Mortgage Lenders, commented that mortgage lenders have little scope to lower their rates further after previous reductions in the base rate.ADNFCR-2002-ID-19059322-ADNFCR

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