Well, it has been good news again this month, with the Reserve Bank making another rate cut of 1%. This 1% cut is the lowest official interest rate since 1964. Again we need to wait to see if the banks pass on this full amount which many have already done so, and for those with a variable mortgage it will definitely help out. This is great news for borrowers and investors, wishing to take advantage of some bargain priced assets and opportunities in an otherwise uncertain market.

The lower interest rate also increases borrowing capacity, bringing homes in to the affordable buying range. It’s not the best news though, for people who have savings in interest bearing accounts. They will be earning less interest on their savings, and with the sharemarket likely to be a bit soft in the year ahead, investors will be looking for higher yielding, safer, less risky investments. For many people property will fit that bill – look out for increasing investor demand later in the year.