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Matthew Hassan, Research Analyst at Westpac, points out that Australian consumer expectations for house prices have deteriorated significantly over the last three quarters.

Key Quotes

“The Westpac Melbourne Institute Consumer House Price Expectations Index has fallen 13.6% since April hitting 112.5 in July, a new low since early 2016 and well below the long run avg of 127.5.”

“The weakness is over and above what is typically a downbeat time of year for housing market expectations – winter tends to see a significant cooling in price expectations – readings since 2009 suggesting this effect alone is worth about 3-4ppts on the national index.”

“As at July, over half of all consumers now expect prices to be unchanged or lower over the next year.”