Rising property prices have triggered a surge in household wealth, according to the Reserve Bank of Australia.
A Reserve Bank statement on monetary policy revealed that household wealth had increased by 10 per cent during the first three months of the year, “driven mainly by higher equity and housing prices”.
“Housing price inflation has remained strong – consistent with the current low level of interest rates – although nationwide it has eased a bit from the rapid pace seen towards the end of 2013,” the statement said.
House prices across Australia grew by 11.5 per cent for the 12 months to 30 April 2014.
The two strongest markets were Sydney, which jumped 16.8 per cent, and Melbourne, which added 11.7 per cent.
Perth grew by 7.6 per cent, Brisbane 6.6 per cent, Adelaide 3.7 per cent and Canberra 1.3 per cent.
The Reserve Bank also noted that housing turnover has risen over recent quarters, while selling times and vendor discounts are both close to 10-year lows.
The demand for new dwellings remains strong in most markets, with industry participants reporting a pick-up in enquiries and visits to display centres in recent months.
Demand from foreign investors for inner-city apartments in Melbourne and Sydney also reportedly remains strong, according to the Reserve Bank.