Bond Traders: Points Investors and Housing

bond traders: Key points:Investors concerned about housing, but only 4pc expect crash Record number of housing completions points to building cycle peak Consumers growing uneasy about property In a survey of leading fixed interest and bond traders, Fitch found a domestic housing downturn had replaced the prospect of a hard economic landing in China as their biggest worry. "Almost all investors surveyed – 97 per cent – believe a domestic housing market downturn poses a high or moderate risk to credit markets in the next 12 months," Fitch said. "Investors also identified property market exposure as the greatest risk to bank credit quality over the next 12 months, and financials as the asset class facing the greatest refinancing challenge." The report showed 43 per cent of investors saw the banks' property exposure as a "critical" risk, ranking ahead of concerns about access to funding and the broader economic landscape, according to Australian Broadcasting Corporation. Fitch said, while concerns about risk were mounting, only 4 per cent of those surveyed believe house prices will fall by more than 10 per cent by 2019. "Confidence was underpinned by their stable views for unemployment and interest rates," the ratings agency added. "At the same time, a string of regulatory initiatives, coupled with active supervision have added starch to bank underwriting standards." However, investors were more relaxed about the prospects of a hard landing in China, with just under a third of those surveyed rating it a high risk, compared to almost half in the previous survey in the June quarter. Related Story: Apartment prices fell 20pc back in 2004, could history repeat Related Story: Economic risks rising but the chance of a crash remains low: Citi, Moody'sMap: Australia A slump in the housing market is now the biggest threat to Australia economy and creditworthiness according to global credit rating agency Fitch. The survey covers the views of managers who look after more than $300 billion in fixed-income assets, accounting for over three-quarters of the Australian domestic real money market. Bank inquiry misses the point Parliament banking inquiry didn't really examine the key problem that Australia giant banks are sucking the life out of the economy. Housing completions point to top of cycle: Morgan Stanley There is also growing evidence that the housing cycle has already peaked, according to big global investment bank Morgan Stanley after the release of the latest Australian Bureau of Statistics data, which showed an extraordinary spike in housing completions. (news.financializer.com). As reported in the news.