Australians are becoming increasingly wary about the nation’s housing market amid signs consumers are winding back their spending on new cars in response to stagnant wages.
The monthly measure of consumer sentiment by Westpac and the Melbourne Institute showed the number of optimists and pessimists almost line-ball across the country.
But it found most shoppers now believe real estate is a dangerous place for their savings. Just 11.6 per cent of those surveyed favoured real estate as the best way to save. It was the lowest result to a question that has been asked by Westpac since 1974.
Westpac chief economist Bill Evans said the result highlighted a key issue among Australians.
“The moves indicate a clear increase in risk aversion,” he said. With bricks and mortar on the nose, more than a quarter said paying down debt was the best way to save.
The survey follows an explosion in house prices in Sydney and Melbourne plus warnings from the Reserve Bank about the exposure of the nation’s banks to the burgeoning property market of the two cities.
AMP Capital chief economist Shane Oliver said while a housing price collapse was unlikely it was likely prices would edge down in Sydney and Melbourne.
Prices in Perth might fall a little this year but they were probably close to bottoming out.
Car sales through February fell to their lowest level since mid-2015 with passenger vehicle sales slumping to their lowest in 22 years.
WA sales have been in trouble for more than two years. Total sales are now down to where they were in mid-2004, having dropped more than 10 per cent over the past 12 months.
Passenger car sales in the State have slipped by 51 per cent since their peak in 2007.