July 14 (Bloomberg) -- Australian homeowners are more pessimistic about the housing market as falling prices and slowing rental growth reel in growth expectations, a National Australia Bank Ltd. poll showed.
Home prices fell 2 percent in the second quarter and rental growth slowed to 1.3 percent, Australia’s fourth-largest lender said in an e-mailed report. Home prices are expected to decline 1.4 percent over the next year, compared with growth of 0.5 percent predicted in the bank’s March quarter survey.
“House buyers continue to cite tight credit conditions as a major constraint in buying property,” National Australia said in the report. Higher interest rates are also concerning buyers, the bank said.
Australian consumer confidence in July fell by the most since Lehman Brothers Holdings Inc. collapsed in 2008 as concern intensified about the European debt crisis and the domestic growth outlook weakened. Australia has the developed world’s highest interest rates after seven increases from October 2009 and November 2010.
Prices are expected to rise 0.5 percent by June 2013, while rents climb by 4.4 percent over the next two years.
The bank’s residential property index, which measures home price expectations among owners and the real estate industry, fell to minus 5 points in the three months to June 30, from 16 points the previous quarter. NAB surveyed real estate agents and managers, property owners and investors, developers, fund and asset managers and valuers across Australia for the quarterly report.
--Editors: Malcolm Scott, Brendan Murray.
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