A new survey has revealed that predicted house price increases over the next two years have been pared back due to Australia’s economic woes and slowdown of foreign buyer activities.
The quarterly report by the National Australia Bank (NAB) also found foreign buyers are less active in all states, with Victoria the only exception.
NAB added that 70% of all property purchases by non-locals are less than $1m. Five percent of these purchases are in excess of $5m.
As for the property type, more than half of foreigners prefer apartments and one-third buy houses.
“We are forecasting average house price growth of around 4% over the year to end-2015 and 2% over the year to end-2016”, said senior economist Alan Oster.
He said NAB expected house values to moderate because of “rising unemployment, sluggish household income growth, affordability concerns, cost of living pressures and high levels of household debt, although two further interest rates cuts this year should help support house prices a little more than previously expected.”