Few people, but slightly more, believe house prices will fall: Westpac consumer index

An outright majority (55%) of consumers still expect house prices to rise over the next year with just under half expecting it to be a rise of up to 10%.

Just over 13% expect prices to fall according to the latest Westpac-Melbourne Institute Consumer House Price Expectations Index which rose 1.4% in November.

Westpac noted at 140.8 the Index is well down on the 164.2 reading this time last year but still in strongly positive territory and well above the 125 average of the past decade.

"As with the ‘time to buy a dwelling’ index, this measure also seems to be settling into a less optimistic but still positive range," the report noted.

Optimists still outnumber pessimists, though the sentiment points to a clear moderation in housing demand, it noted.

"While the investor segment remains an important exception, actual data on housing activity is also showing a clear moderation."

It noted big geographic differences with a weak reading for WA notable - given a clear drop-off in price momentum.

Despite interest rates at historic lows and a buoyant housing market, home owners are significantly more downbeat about Christmas spending, particularly those with a mortgage, the report found.