2008.12.12 04:16:57
It’s Friday evening and I have not even had a chance to see what the news is today.
I did see that Westpac in Australia were getting flack for not passing on the entire 1% interest rate cut from the Reserve Bank.
They justified not passing on the whole OCR cut by commenting that the overall cost of funding was very expensive and they could only pass on .8% interest rate cut.
Interestingly though the other big banks had passed on the entire 1% rate cut in the official cash rate.
I have a fair bit of catch up reading to do to see what is happening with property prices as the interest rates come down. Hopefully with the combined lower interest rates and the government incentives like the first home owners grant the property market will be getting a boost.
Certainly as the interest rates move towards the average yield property becomes a much more attractive option and the market will start to see some movement.
Buy and hold investors will be taking a good look at the market by now as properties approach the all important cash-flow positive mark, as will some of the more speculative investors.
So welcome the lower variable rates available with open and happy arms.
p.s don’t forget to visit my Financial Planning site at either www.nzpis.com which is the main site or Professional Investment Services which is a landing page with 2 free e-books.