The Australian property market has recorded its strongest winter results since the global financial crisis with home values across the country surging by 4.2 per cent, figures released by RP Data on Monday show.
RP Data research director Tim Lawless said the nation had a two-tier property market with the strong national result driven by dramatic capital gains across the Sydney and Melbourne markets.
According to the report, Sydney home values grew by 5 per cent over the winter months.
Melbourne was the surprise star performer with home values surging by 6.4 per cent in the three months to September.
In August Melbourne values grew by just 0.8 per cent but in July RP Data reported a staggering 3.7 per cent surge in values for the southern capital.
In the past 12 months Sydney and Melbourne have been the only markets to record double-digit growth, with values up 16.2 per cent and 11.7 per cent respectively.
"Investors are mostly concentrated across the Sydney and Melbourne apartment markets where capital gains have been strong but yields have been pushed very low," said Mr Lawless.
Sydney still remains considerably more expensive than Melbourne with a median dwelling price of $650,000. RP Data put the Melbourne median at $523,750.
Over the winters months home values in Canberra grew by 2.4 per cent followed by Adelaide (1.5 per cent), Brisbane (1.3 per cent) and Perth (1 per cent).
Home values in Darwin fell by 0.6 per cent and Hobart was the nation's worst performing city with values sliding by 0.8 per cent.
Mr Lawless said spring should bring more good news for home owners in the top performing capital cities.
"With today marking the first day of spring, we are expecting listings numbers to rise over the coming month which will provide a real test for the housing market," he said.
"Considering the ongoing high rate of auction clearance rates, a generally rapid rate of sale and the ongoing low interest rate environment, it's likely that dwelling values rise even further over the next three months.
"Consumer confidence is also moving in the right direction now after the post-budget slump which will add fuel to the exuberant buying and selling conditions we have seen during winter."