RBA says housing market may be slowing
Edgy home buyers and a crackdown on bank lending to property investors appear to have drained momentum from Sydney’s housing boom, the Reserve Bank says.
Ahead of another bumper auction weekend, the central bank on Friday pointed to “tentative” signs of a slowdown, citing slower price growth, a run of weaker auction results, and a turn in sentiment in Sydney and Melbourne.
While it remains on alert over the housing market – where it said risks were “higher than average” – it also said there were “a few tentative signs that sentiment may be turning in the housing markets of the two largest cities.”
Recently, home buyers and a crackdown on bank lending to property investors appear to have drained momentum from Sydney’s housing boom, the Reserve Bank says.
Ahead of another bumper auction weekend, the central bank on Friday pointed to “tentative” signs of a slowdown, citing slower price growth, a run of weaker auction results, and a turn in sentiment in Sydney and Melbourne.
While it remains on alert over the housing market – where it said risks were “higher than average” – it also said there were “a few tentative signs that sentiment may be turning in the housing markets of the two largest cities.”
Queensland house prices are expected to rise 2 per cent next year.
Queensland house prices are expected to rise 2 per cent next year.
“Recently there have been tentative signs of some slowing in the Sydney and Melbourne housing markets: auction clearance rates have fallen and price growth has eased in Sydney of late,” the RBA’s Financial Stability Review said.
It comes amid predictions of house price falls and Westpac’s shock move to this week jack up interest rates by 0.2 of a percentage point for the first time in more than three years. Other banks are likely to follow to some extent, analysts say, which could take more heat out of the property market.
The rate hike has also sparked predictions the Reserve Bank may cut interest rates next month as it tries to stimulate the economy and create jobs growth. The RBA did not comment on interest rates, only saying competition between banks remained strong, despite Westpac’s move.
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