Be wary of housing oversupply: HSBC

Australian property prices could slide if the current surge in home construction continues, a leading economist warns.

HSBC Australia chief economist Paul Bloxham says while an oversupply of housing seems unlikely in the near term, it could be a risk late in 2016 and going into 2017.

"Slowing population growth has begun to raise questions about whether supply could eventually exceed demand, leaving Australia with too many houses," he said.

"This could affect the house price outlook. It may also make the RBA more cautious about cutting rates further from here, as the costs of cutting further could start to outweigh the benefits."