Falling house prices caused uncertainty in household consumption, which disrupted the country's economic growth.
According to Bloomberg report, the decline in values ​​begins to "overshadow" the initial scenario of Reserve Bank Governor (RBA) Philip Lowe, who predicted a steady rise in prices, which would tighten the labor market and slowly raise inflation upward.
The recession is expected to worsen, with the Sydney market falling 10% and banks withdrawing from the credit sector due to increased supervision.
"The outlook for household consumption remains a source of uncertainty as income growth has remained weak, debt levels are high and housing prices are falling. Members noted that this combination of factors posed a risk of loss, "said the RBA at its last political meeting of the year.
Through liaison with the developers, the RBA also found that the demand for new housing in Eastern Australia had calmed down. Some developers have reported that this declining demand has become more obvious. The demand for off-plan apartments has dropped considerably since the middle of 2017.
Bill Evans, chief economist at Westpac Banking Corp, said the minutes of the meeting suggested a loss of confidence of the central bank in the economy.
"In view of the attention paid to credit, housing, consumer and external risks, these minutes should be interpreted more dovishement than we had during the course of the year. year 2018, "said Evans.
Can you afford to buy in this suburb? Find out how much you can borrow
Top suburbs:
new city
,
Windale
,
willoughby east
,
Greenwood
,
Toowong
Get help for your real estate investment
Do you need help in finding the right loan for your investment?
When you invest in real estate, it's important to make sure that you do not just have the lowest available rate that you can get, but you also have the features of ready adapted to your needs.
Just fill in a few details below and then we will make the necessary arrangements for a local Australian mortgage broker to contact you and solve the problem What features or what types of loans are suitable for your needs? We will even help with the paperwork. In addition, an appointment is free.
We value your privacy and treat all your information seriously – you can check
our privacy policy here
