The Westpac-Melbourne Institute Consumer Confidence Index lifted 9.4% to 85.8 in April, with confidence across mortgage holders growing 12.2%.
The largest gains in confidence were observed across the outlook for property prices, with the survey recording an uptick of 16.7%.
Westpac Chief Economist Bill Evans noted confidence in the outlook for house prices has boomed.
“The national index of House Price Expectations lifted by 16.7% to 130.31, only 2.8% below its level in April last year, just before the tightening cycle began,” Mr Evans said.
“The index has increased by a remarkable 43% since its recent low in November last year.”
Still, an index rating of 85.8 is still pessimistic by historic standards.
Across the states, confidence in the outlook for property prices lifted in Western Australia by 36%, Queensland by 30%, New South Wales by 16% and Victoria by 9.5%.
The growing confidence surrounding property price expectations comes as CoreLogic’s Home Value Index for April recorded a 0.6% lift in national property prices for the first time in 10 months.
Dwelling price expectations in the consumer sentiment release keep rising and tend to lead actual prices. pic.twitter.com/EqA0dfa4fn
— Alex Joiner (@IFM_Economist) April 11, 2023
Despite the uptick in confidence, Mr Evans detailed survey respondents are remaining cautious with 34.11% still expecting the Standard Variable Rate to be raised by more than one percentage point over the next year.
“That proportion is certainly down from 44.55% in March and 59.64% in November but still points to considerable apprehension around interest rates on the part of consumers,” he said.
“With underlying inflation still likely to be in the 6.5%–7.0% range and the unemployment rate holding around fifty-year lows the case for extending the pause in May is likely to be challenged.
“The Board’s decision will be to weigh the “here and now “evidence against its two-year forecast.”
Read more: What does April's cash rate pause mean for the remainder of 2023?
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