Australian property sector prospects "generally positive"

The outlook for the Australian property sector is broadly healthy, an economist from the Reserve Bank of Australia has said.

Deputy governor of the institution Ric Battellino commented that a number of factors mean the future should be a strong one, with one notable factor for overseas buyers being the likelihood of high levels of immigration as the demand for labour picks up.

He also suggested the sector will be boosted by rising household incomes.

Mr Battellino noted that the country will need to increase its construction of homes to deal with demand, predicting that there may be competition for labour between the industry and the expanding mining sector.

He added that while investment in housing has risen in recent years above historical norms, much of this has gone on refurbishment, holiday homes or replacing demolished dwellings.

House prices have been increasing in Australia, according to recent data from the Australian Bureau of Statistics.

Figures for the prices in state and territory capital in the three months to the end of September showed that these jumped by 4.2 per cent.