Potential home buyers are dropping out of the housing market, scared off by the prospect of interest rate rises and economic uncertainty.
Industry-owned real estate portal realestateVIEW.com.au surveyed 1,475 consumers across Australia last week.
"Our survey shows that while interest rates are a key concern for buyers, there are other factors such as household expenses and job security influencing their ability to purchase," realestateVIEW.com.au general manager Petra Sprekos said in a statement.
"Consequently, we're finding most are adopting a wait-and-see approach.
"We definitely don't see this changing anytime soon, especially if the big four (banks) break ranks with the RBA again and raise mortgage rates this month."
The survey found that the percentage of consumers looking to buy homes had fallen to 32.7 per cent in 2012, from 43.5 per cent in 2011.
The most prominent factor affecting purchasing decisions was interest rates, followed by housing affordability and increasing household expenses.
Although interest rates was the top concern, two-thirds of respondents said the RBA's official interest rate cuts in November and December had not encouraged them to acquire property.
Nearly 23 per cent of respondents said they had planned to buy this year, but were put off by the big four major banks's decision in January to raise their interest rates, despite the RBA keeping the cash rate on hold at 4.25 per cent.
More than 41 per cent of respondents said that further interest rate rises would keep them out of the market this year.
The survey also showed that more people were looking to buy properties priced above $1 million.
The percentage of buyers in the top end of the market had more than tripled, rising to 4.0 per cent in 2012 from 1.2 per cent in 2011, suggesting that buyers wanted to take advantage of cooling prices for higher-quality properties.
