The Westpac consumer sentiment index collapsed by 2.9% to 80.6 in June, with Australians showing deep pessimism across finances, the economy, housing, and savings behaviour.
The survey is back near the weakest levels in its 50-year history, with pessimists outnumbering optimists by nearly 20%.
Household finances have deteriorated, with finances versus a year ago falling 7.5% to 67.3 and those in the next 12 months falling 8.5% to 85.1.
These readings are extremely weak, with sub‑85 results occurring only a handful of times in 50 years.
Westpac says consumers are “bracing for more bad news” despite a slight easing in mortgage‑rate fears.
The economic outlook remains mixed, with expectations for the economy over the next 12 months rising 4.9% to 77.8 – still fragile but less dire than in May. However, views on the economy over the next 5 years fell 3.2% to 86.5—a three‑year low.
The March quarter GDP result (+0.3%) may have softened near‑term pessimism, but medium‑term confidence has worsened.
Major purchases remain depressed, with the time to buy a major item sub index tracking 37 points below the long‑run average at 86.4.
Westpac says households remain in “buyer restraint” mode.
The time to buy a dwelling rose 12.6% to 81.1, but remains very weak.
Conversely, the house price expectations index tanked by 14.9% to 128.2—the first drop below the the long‑run average in nearly three years.
The sharpest falls were in NSW (‑19%) and Victoria (‑18%), where prices are already correcting. WA remains weakest for buying sentiment (index 59).
The quarterly “wisest place for savings” responses show a historic collapse in confidence in real estate:
- Real estate: 4.5% (record low; long‑run average 24%)
- Bank deposits: 31%
- Pay down debt: 27%
- Superannuation: 8%
Two‑thirds of consumers now prefer low‑risk options.
The unemployment expectations index was flat at 139.8—above the long‑run average, signalling ongoing anxiety about job prospects.
The mortgage rate expectations index fell by 4.8% to 172.6, with two-thirds still expecting rates to rise, but fewer than in May.
The RBA is expected to pause in mid‑June after three consecutive hikes, but Westpac still anticipates further tightening later, given inflation remains above target and energy‑price impacts are still unfolding.
