The Bank of England cut its base rate by 25bp on Tuesday to4.75%, a rate not seen since the early 1960s. This followedMonday's 50 bp cuts by both the US Federal Reserve and the EuropeanCentral Bank. US base rates are now at 3.00% with European rates at3.75%.

Superficially, cheaper money is good news for debt-drivenproperty investors, but according to Laxton borrowers are currentlyunable to take advantage of the new rates. Lenders are generallynot providing fixed interest rate quotes beyond ten years, becausethere is temporarily no liquidity in the long-term interest rateswap markets. 'In recent days this has affected some propertyinvestors due to complete on geared transactions, a problem thatwill only be alleviated once liquidity returns,' said Laxton.

The problem is primarily affecting larger transactions of £10million ($14.7 million) and upwards, looking for finance for 15years and beyond. 'This is expected to be a short-term phenomenonbut it may have an effect on some major transactions which are dueto complete in the next few days,' said Laxton.