QIC sees Australian consumer spending weathering housing downturn
SPY•QIC’s analysis says Australia’s housing downturn could slow consumer spending without triggering a recession if jobs and incomes grow. It estimates a 10% fall in house prices would reduce household spending by around 1.4% over 12 months.
1. Spending and housing
QIC’s analysis says falling housing turnover leaves big-ticket and housing-related purchases most exposed, with developers reporting sharper declines in buyer demand. Its modeling estimates that a 10% fall in house prices would reduce household spending by around 1.4% over 12 months.
2. Borrower finances
QIC says around 2% of variable-rate mortgage borrowers cannot cover repayments and essential expenses, while most have savings covering at least six months. Fewer than 1% of borrowers have negative equity.
