Many industry experts believe the UK property market will be mirroring the Australian one as they share many similar traits, the Royal Institution of Chartered Surveyors says.
However, RICS warns, while there are many similarities between the two, there are also several differences.
Early 2004 saw house prices drop in Australia, according to some of the country's national reports.
The Australian Bureau of Statistics (ABS), however, says the market has experienced a slowdown and not a fall.
The latter finding reflects to a large extent what several British surveys have been saying about the UK housing market over the last couple of months.
RICS believes there are several similarities between the two markets.
Both Australia and the UK have experienced very strong house price rises since the mid-90s.
Moreover, the level of debts are high in both countries, with the level of interest rates rising in both Britain and Australia.
Milan Khatri, chief economist at RICS, says: "Australia's experience may well be a pointer to the likely direction of the UK housing market, with interest rate rises making a slowdown probable but not necessarily a precursor to a deeper downturn."
That said, RICS cautions people not to read to much into the similarities between the two markets, and says although interest rates are rising in both countries, the UK interest rate hikes are starting from a lower base than in Australia.
There is also much higher levels of investment activity in the housing market in Australia, which effectively increases the risk of a downturn if investors decide to sell, RICS adds.IFAonline
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