In the last year the market has been gracious to us as we’ve seen a 10% increase in home values in Australia. With this trend Sydney has shown to be the dominant capital city showing the highest increase.

CoreLogic RP Data Home Value Index shows dwelling values across Australia’s combined capital cities rose 2% in the June quarter and 9.8% for the 2014/15 financial year. The record was set in the previous financial year coming in at 10.1% just a bit over this years.

This is no surprise that Sydney remains the most expensive capital city with the average price coming in at $772,000 and the least expensive city is Hobart with an average price of $315,000. The housing market gained momentum as soon as the interest rates we’re cut in February and May.

The official Reserve Bank cash rate is sitting at a historic low 2%. Tim Lawless, CoreLogic RP Data Head of Research pointed out that the low interest rates have particularly pushed the market in Sydney and Melbourne higher.

Growth conditions had been moderating from April last year through to the end of January 2015, he says. With the RBA cutting the cash rate in February, there was an instant buyer reaction across the Sydney and Melbourne housing markets where auction clearance rates surged back to levels not seen since 2009, capital gains once again accelerated and we are now seeing Sydney and Melbourne homes selling in record time; Sydney homes are selling in just 26 days and Melbourne homes are selling in 32 days.

The market was more subdued across the rest of the country, with Adelaide the next best performing capital with dwelling values increasing 4.5%. Brisbane home values increased 3.4%, Canberra values rose 2.4%, while Hobart saw an increase of 0.9%.