The housing slowdown will be deepest in Sydney and Melbourne because tight bank credit rules will hit buyers hardest in the least-affordable cities.

Digital Finance Analytics founder Martin North says “credit is still growing”.

“It’s a bit of a battlefield out there and I think the banks are chasing their own tails trying to figure out what to do,” he tells Ross Greenwood.

Mr North says those already in the property market are fine, but new investors who are trying to get into the marketplace are battling.

“This is a really really tricky time for individuals and lenders.

“It’s probably the first time in a generation that bankers actually have to earn their corn.”

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