MasterCard analyst Sarah Quinlan said this trend foreshadowed "a downturn" in the housing market in 2016. Westpac Group, Adelaide Bank and major lending networks continue to pile on the pain for property buyers. Credit:Louie Douvis "We are seeing a pronounced slowdown and it's deepening each month," she said. "Therefore we fully expect real estate will weaken further." Domain Group data shows Sydney's median house price surged more than 50 per cent over the past three years but the latest figures revealed a modest correction in the December quarter. Housing construction has been a key factor in the NSW's relatively strong economic performance in the past three years. More than 66,000 homes were approved in NSW in 2015 which is 74 per cent above the decade average and well above the next highest number of approvals of 57,593 in 1994.

Melbourne's median house price rose by 14.5 per cent last year to almost $720,000, according to Domain Group. That was the biggest yearly increase since the boom of 2009. However, the rate of growth slowed appreciably in the December quarter. Robust housing construction has been an important driver of growth in the Victorian economy. But Ms Quinlan said slowing spending on household goods was a "precursor" of a weakening housing sector in other countries where MasterCard tracks spending trends. "It's the same correlation in the United States," she said. "We saw a drop in appliance sales for eight months and sure enough we saw the housing recovery basically slow to a crawl - it's a very correlative indicator." Ms Quinlan said there had been a noticeable shift in Australian consumer spending on household goods from last July, a few months before Sydney's median house price peaked at $1,032,433 in the September quarter. "We are watching people be much more cautious about the purchase of these types of durable goods," she said. "Many people just don't want to make such a big purchase now."

MasterCard's new SpendPulse report, launched this month, tracks trends in Australian consumer spending using data from electronic transactions and other forms of payment, including cash. Ms Quinlan said overall spending trends suggested growing caution among Australian consumers. She attributed this to concern over the health of the Chinese economy, the steady decline in the value of the Australian dollar and ongoing weakness in the mining sector. Very low wages growth has also weighed on consumer spending. "While we expect to see moderate growth continue in 2016, sustained uncertainly of global markets means that we are unlikely to see substantial leaps," she said. The first SpendPulse report for Australia showed a 3.2 per cent increase year-on-year in total retail sales during January. Spending in clothing stores was up a healthy 5.2 per cent while growth in department store spending was more subdued at 2.1 per cent.

MasterCard produces similar reports in the United States, Japan, United Kingdom, Canada, Hong Kong and Brazil.