Continuing pressure on house prices
The ANZ Property Gauges, which uses 10 indicators to measure the state of the property market and for signs of change that will impact on house prices, reported overall downward pressure on house prices in June.
Rising interest rates is the biggest negative factor influencing the market, with affordability, serviceability and liquidity all showing a negative impact on house prices as a result.
The Official Cash Rate (OCR) hike earlier this month and subsequent upward movement of floating and short-term fixed interest rates have dented affordability for new entrants into the housing market and although existing borrowers continue to pay down debt, demand for credit is still subdued and households continue to deleverage.
Building consents and house sales look to face headwinds in the future, according to the report, with house sales still low as uncertainty weighs and although consents have picked up slightly, they still have a way to go towards recovery.
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