Hot property markets, interest rate cuts and a favourable federal budget are all helping to buoy retail spending in an environment that would not usually be beneficial to shopkeepers.
That's the view of Deloitte Access Economics in its quarterly retail report, pointing to less supportive historically low wage growth and a labour market that is struggling to generate enough jobs to prevent a rising unemployment rate.
Deloitte partner David Rumbens also warns that what Treasury secretary John Fraser has described as unequivocally a property bubble in Sydney and Melbourne "is unlikely to end well".
"But it may well contribute to an environment of healthy retail spending growth for a while longer, as it encourages additional borrowing and sparks housing construction activity," Mr Rumbens says in the report released on Wednesday.
He expects retail spending to have grown at an inflation-adjusted 3.4 per cent in 2014/15 after a very solid 3.1 per cent in 2013/14, but this is likely to be the peak.
Sales growth is expected to slow to 2.6 per cent in 2015/16 and 2016/17 as the support from rapid house price gains fade.
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