House prices tipped to fall amid tight credit conditions
Australia's housing market is set for a slowdown this year in the wake of last year's interest rate hikes and continuing constrained access to credit, new research shows.
According to the latest National Australia Bank (NAB) Residential Property Index, home prices are expected to fall by 0.5 per cent over the next 12 months, with Brisbane set for the biggest decline of 1.7 per cent.
The forecast came as it was shown that the index for December fell to 27 points, down from 44 in November, with various factors attributed to the housing market slump.
"Conditions in the Australian residential property sector over the next 12 months are expected to weaken considerably," said NAB.
"Tight credit conditions and rising interest rates are the main impediments to new residential developments and existing property sales."
Consumers struggling to get a foot on the property ladder could choose to compare home loans in search of the best options. As the index was calculated before the Queensland floods, it has been suggested that the next residential survey will be even worse.
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