Figures from the Australian Bureau of Statistics show the number of new owner-occupier home loans written in February fell 5.9 per cent, seasonally adjusted.

The HIA's Ben Phillips says the full impact of the interest rate rises in February and March is yet to be seen and the downward trend for housing finance is likely to continue.

"Most banks have also been increasing their retail rates so we're likely to see that the numbers will be worse again when we look at them next time around for March," he said.

"We expect that this will probably continue for at least the short term, whilst interest rates remain quite high."

Mr Phillips says the recent interest rate rises and the possibility of further increases may see investors shy away from real estate.

"We're likely to see less investment in housing - both new and existing housing that is - and this is a big concern for rental stress," he said.

"We've already got a situation where there's a very limited supply of housing there for rent and we're likely to see that this situation will only get worse. You'll see continued increases in rents."

-abc.net.au