Amid all the negative headlines predicting property doom and gloom one leading indicator suggests that the markets may stabilise sooner rather than later.
It's early days but Google searches for house-buying related terms are up. 
And ANZ Bank suggests this points to potential stabilisation in house prices later this year.
According to ANZ several other indicators are also suggesting an improvement in the housing market may be in the offing for later this year.
- Sydney’s auction clearance rate has ticked up, and
- The housing credit impulse lifted in July.
But there are headwinds to battle
Firstly there is the impact of one of the major banks raising their variable mortgage rates, if only by a very modest amount.
ANZ Housing Search Index for August 2018.
This index suggests that while there is still more pain to come over the coming months, house prices are set to stabilise towards the end of this year (Figure 1 and 2 below.)
As a quick refresher, the ANZ Housing Search Index uses Google Trends to aggregate internet searches related to house buying.
The Index is constructed from these searches provides information about the likely evolution in house prices.
Figure 1. ANZ Housing Search Index signals dwelling price stabilisation towards the end of this year
Figure 2. …but ANZ expect more weakness in the near-term
THERE ARE OTHER SIGNS OF EMERGING STABILITY IN HOUSING
ANZ reports that the lift in housing-related internet searches is not the only better news on housing.
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The Sydney auction clearance rate lifted a touch in August, suggesting we may be past the worst (Figure 3).
Consistent with this, there was a lift in housing finance in July, with the gain sufficient to turn the housing credit impulse (Figure 4).
Figure 3. Sydney auction clearance rate improves
Figure 4. Housing credit impulse turns up
Still early days
ANZ say it's a bit too early to conclude that the worst is past for housing and that the correction has had little impact on the broader economy.
Melbourne’s auction clearance rate is still falling, for instance.
In light of this, it is not surprising that Melbourne was the weakest market in the three months to August, with dwelling prices down 2.1% q/q according to CoreLogic.
We also have to see how the market reacts to the rate increase by Westpac says the ANZ report.
While an increase of 14bps would not usually be seen as significant, the fact it has happened against the backdrop of falling house prices may mean the impact is magnified.
ANZ say the last time we saw this combination was in the first half of 2008.
Source: ANZ Bank
