The Organisation for Economic Co-operation and Development says Australia's financial stewards and bank regulators should be prepared for a soft fall in the housing market as house prices have fallen gradually since late 2017.
In its latest assessment of Australia, the OECD found the housing market poses a risk to the nation's economic growth going forward.
The OECD has recommended regulators should also turn their attention to ensuring accountability, transparency and competition among financial institutions after the banking royal commission.