The Melbourne Institute and Westpac Bank release new figures on Wednesday which showed an increase of consumer sentiment by 2.8% in November, following a gain of 1% in October.
The index fell sharply in September in response to Australian political instability and mortgage rate hikes by Australia’s big four banks.
Optimists outnumbered pessimists in the survey of 1,200 people, with respondents showing more upbeat attitude toward their finances and the long-run economic outlook.
The November reading was up 4.7% from a year earlier at 104.3.
Economists were surprised with the results that were positive despite on-going reports around weakness in the housing markets and sharp falls in the market in October.
The survey’s index of family finances 4.9% higher in November, comparing to its result in October, recording its highest since February 2016.
Economic outlook for the next 12 months added 3.2% in November.
Economic conditions for the next 12 months also rose 1.7 %, while the measure for a longer-term outlook, over the next five years surged 9.7% while respondents were concerned about a global trade war.
Falling housing prices pressure sentiment
The housing index indicating buying a dwelling jumped 11.8% in November and was up almost 17% from the previous year earlier, with respondents still cautious on spending too much.
The index on whether it was a good time to buy a major household item slipped 3.5 % to an 18-month low.
Figures also show respondents are cautious and expect to spend less on Christmas gifts than they did last year, with 56% expecting to budget their sped based on previous years, and just 10% planning to spend more.