Many Australians are bracing for a property slowdown over the next 12 months following the accelerated price expansion seen last year as the latest survey by the National Australia Bank (NAB) showed that the annual property price growth plunged from the 5.2 percent posted in March to a mere 1.4 percent in the June quarter.

NAB has expressed alarm that the figures were too far off from the 12 percent price growth seen last year as low interest rates and first home buyers boost were positively affecting the market price to expand.

As the bank polled 248 real estate agents, developers, fund managers and property owners, the survey results pointed to Melbourne as emerging with the biggest slide in expectations, which only in the year to March 2010 had posted a home price boom of 20 percent, as furnished by figures collected by RP Data.

The NAB survey found that Melbourne's expected annual property price inflation dropped from the March figures of 5.8 percent to only 0.7 percent in the June quarter while Canberra is slated to take the helm as the biggest price achiever over the coming year with its posting of 2.9 percent growth.

The survey said that respondents are expecting homes priced at $250,000 to $500,000 to gain the biggest price jumps while houses and apartments priced beyond the $2 million mark are expected to suffer declining prices.

NAB also said that residential property market is expected to attract an estimated 50 percent of existing owner-occupiers while locally-based investors were predicted to secure up to 29 percent with the first-time buyers conquering only 13 percent of the market.

The survey noted that the shrinking first-home buyers were due to rising interest rates and lowering first home loan grants as latest housing finance numbers pointed to only 16 percent loan approvals for fresh home buyers, which is way below from last year's 30 percent when interest rates were just three percent and grants peaked to $21,000 for those acquiring their first property.

NAB said that overseas purchasers were predicted to cut out nine percent of the residential property market as rental growth is seen to moderate with an expectation of 1.9 percent growth through next year.

The NAB report blamed the upward moving cash rates as the main culprit in discouraging would-be buyers in acquiring already built residential properties as further real estate developments were seen hampered by the lack of credit facility, according to those polled.