Doesn't property look safe

Doesn't the property market look like a safe place to put your money these days. We have heard heaps of stories about how house prices are falling - or more correctly that they are increasing but not as quickly as before.

Those stories looks pretty tame against the carnage going on in sharemarkets around the world at the moment.

The latest big bit of news is that the equivalent of our Reserve Bank in the US - the Fed Reserve - has chopped 75 basis points off its official cash rate. Cuts of this magnitude are rare (last time 9/11) and it has been made at a special meeting, not the Fed's regular one which is scheduled for next week.

The good news for investors is that these cuts may well help to drive down long term home loan rates in New Zealand.

We have already seen this with Kiwibank and Westpac both lowering their five year rates this morning.

While five year rates still are not cheap there is a place for them in property investment portfolios. You can keep an eye on changes here.

The other thing to watch is the Reserve Bank's OCR announcement tomorrow. We will send out an email on its decision in the morning.