Lower rates could be good news for property investors

Consumer confidence in the real estate market could be given a much-needed boost if the Reserve Bank of Australia chooses to reduce the cash rate during its next meeting.

Industry speculation has focused on the prospect of a rise in interest rates some time before the end of 2011, but recent comments from a prominent commentator has given professionals with property investors a reason to pause.

Writing for the Business Spectator, analyst Christopher Joye said that a number of credible financial institutions had predicted a negative shift that could have positive results for investors and homebuyers alike.

Joye stated: "Institutions like AMP, Goldman Sachs, Deutsche, Macquarie and Westpac all think the next move in rates will be down. This is starting to feed back into consumer confidence.

Lowered interest rates will filter back to homeowners in the form of reduced mortgage payments and perhaps easier access to loans for property purchases - good news at a time when the cost of living has risen.

This may give investors with property management training a reason to become more active in the market, with a number of localities recording low median housing prices in recent months.