Forum Archive Index - January 2004

[mixtrader <mixtrader@clear.net.nz>]

Hi Phillip

 

I won't be using further leverage to increase my property portfolio based on the current NZ property market.  For the longer term, I think that the property bubble has run its course, the rate of capital gain will slow (if not stop) and there will probably be a "cooling off period" although I would not expect to see too much drop in values (particularly in the residential sector).  I treat the property market as a cyclical type of market and have watched these cycles with interest over the past 20 years or so (as a Real Estate Agent and Property Valuer it has been my bread and butter).

 

With regards equities, I would never borrow money to buy shares (at least not after 1987) however there will be some impact on business with the higher rates affecting firms in the export sector.  The rate change is fairly small at 0.25% but there will be a tightening in the capital markets.  F/A share "traders" will most likely factor this in when they consider the debt ratio of the firms they invest in.  Unlikely to affect most T/A traders.

 

Thats my 2 cents worth

 

Regards