From Standard & Poors:
MELBOURNE (S&P Global Ratings) June 3, 2019–Despite some recent positive developments, S&P Global Ratings expects house prices in Sydney and Melbourne to fall further in the next six to 12 months due to weak consumer and business sentiment.
Low wage growth, global economic uncertainties, and a realization by market participants that Australian house prices and private debt are high are among the factors posing a drag. The recent reelection of the incumbent government, the potential relaxation of interest rate buffers when assessing loan serviceability, and a possible cut in the policy interest rate this week should stabilize sentiment, the availability of credit, and therefore house prices. However, we consider the impact of these positive developments uncertain and will wait for further evidence of stabilization before concluding that related economic risks facing the Australian banks have eased.
