Foreign buyers' demand for Australian property eased in the June quarter to the lowest point in two years, according to the National Australia Bank's residential property survey.
NAB found the overall share of foreign buyers in established property fell to 10.2 per cent in the second quarter, the weakest in two years, compared with 13.9 per cent in the first quarter.
In the new property market, the share of foreign buyers fell to 7.2 per cent, from 9.5 per cent in the first quarter.
NAB found local investors were more active in the new property market, accounting for almost a third of all new property sales.
National house price growth eased to 0.9 per cent in the quarter, compared with 1.7 per cent in the first quarter, according to the survey.
"There are now clear signs that the momentum in the dwelling market has eased," NAB said.
"NAB expects average capital city house prices to cool further over the next two years towards more sustainable levels."
The biggest concern for buyers of new property was housing affordability, displacing worries over credit availability, the survey found.
In most states, the biggest impediment to buying established property was employment security, except in NSW, where house prices and lack of stock were the key issues, NAB found.