Almost three-quarters of Australians expect mortgage rates to be higher in the next 12 months but it hasn't stopped a growing number of first home buyers entering the market.

New figures show the proportion of new entrants taking out a mortgage in June was 15 per cent, up from 14 per cent in May and the highest in two-and-a-half years.

"First home buyers are fighting their way back into the market, clearly assisted by the new restriction on loans for investors, that is starting have a real effect," Treasurer Scott Morrison said in a Facebook post.

Commonwealth Bank senior economist John Peters expects stamp duty reductions announced by the NSW and Victorian governments, which began on July 1, may also generate some stronger outcomes in coming months.

However, a separate report on Wednesday shows concerns about housing affordability in the two states, worries surrounding interest rates and increased pressures on family finances are weighing on confidence.

The Westpac-Melbourne Institute consumer sentiment index fell by a further 1.2 per cent in August.

This was ninth consecutive month where pessimists have outnumbered optimists, the weakest run since 2008 and when the world entered the global financial crisis.

This is in stark contrast to a survey released on Tuesday which showed both business conditions and confidence at the highest level in almost a decade.

The latest decline in consumer confidence came despite Reserve Bank governor Philip Lowe signalling no immediate change in interest rates, a continued improvement in labour market conditions, lower petrol prices and a booming Australian dollar.

The sub-index in the survey tracking views on 'family finances versus a year ago' tumbled 5.1 per cent to its lowest level since June 2014 when consumers were shocked by the Abbott government's first budget.

"Much of the weakness is likely to reflect a mix of weak growth in wages, increases in key costs such as electricity and emerging concerns about rising interest rates," Westpac chief economist Bill Evans said.

In response to an additional question in the monthly survey, 71 per cent of consumers expect mortgage rates to be higher in 12 months, while 27 per cent expect them to hold steady and just 2.6 per cent see a further cut.

Such views coincided with housing finance data showing the proportion of borrowers taking out a fixed-rate home loan was 17.5 per cent in June, the highest since November 2013.