Market ‘uncertainty’ causing Australia’s house price growth to slow

REA Group Economist Paul Ryan says home price growth slowing to a 12-month low is partly due to “faster than expected” interest rate expectations later in the year.

Mr Ryan said there is a lot of “uncertainty” over how quickly interest rates will rise later in the year.

“On one side you’ve got the market who I think are pricing the cash rate at the end of the year will be at 2.5 per cent and then you’ve got major bank forecasters who are saying something around 1 or 1.25 per cent at the end of the year,” Mr Ryan told Sky News Australia.

“That makes a big difference for mortgage holders and for potential buyers so I think that uncertainty is already something that’s weighing on the market and I think that’s part of the reason we are seeing price growth slow so much.”

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