The reserve bank (RBA) offered yet more good news for Australian home buyers as they issued a rosy statement on the future of the property market.
The central bank believes stabilising property prices and a combination of interest rate cuts and tax offsets has helped housing investment return to growth sooner than it had previously expected.
The RBA said the trough in dwelling investment will now occur about six months earlier than its previous prediction — adding to the turnaround in housing market conditions.
Lower interest rates and recent federal government tax cuts were the key upside risks contributing to the upturn.
“The signs of stabilisation in the housing market reduce one possible source of downside risk to consumption growth and could provide some upside risk towards the end of the forecast horizon,” the RBA said.
REA Group chief executive Owen Wilson has added to this news by suggesting the Reserve Bank will cut interest rates once again to improve residential real estate further.
"What we're seeing is that the buyers are definitely back," Mr Wilson told The Sydney Morning Herald and The Age.
"Couple that with two interest rate cuts, the retention of negative gearing, Australian Prudential Regulation Authority changes — borrowers now have got a higher capacity than last year. All the conditions are there for a recovery.”
Indeed, capital city home auction clearance rates continued to climb nationally, with strong results in Sydney and Melbourne.
Figures released by data provider CoreLogic show an average 70.4 per cent of the 1,107 auctions held across Australia during the week ended Sunday August 11 had cleared, well up on 66.4 per cent of 1,107 auctions held the week before.
“We've got a really strong result out of Sydney this week, above 80 per cent,” CoreLogic auction market commentator Kevin Brogan told AAP.
The clearance rates in Sydney were not only almost 10 per cent higher than the previous week but well above a year prior, where 458 auctions yielded a clearance rate of 53.8 per cent.
"We've got some very high performing regions and they're typically higher value houses, which previously led the market softening but are now leading the recovery," Mr Brogan added.
North Sydney and Hornsby led the way in the harbour city, and there are still plenty of properties on the market in the region, including the Norfork Penthouses at Kurraba Point.
A sweeping statement of refined luxury and uninterrupted harbour views, these four extraordinary, once-in-a-lifetime residences are exceptional from every angle.
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