Fresh signs are emerging the housing sector is finally responding to low interest rates, with house prices across the country lifting through February.
RP Data-Rismark reported yesterday house values rose 0.2 per cent last month to be 1.3 per cent higher through the quarter.
In WA, house values edged down 0.7 per cent but still stood 1.4 per cent higher over the past three months. Over the past year they are 3.9 per cent stronger, the second best market in the nation behind Darwin.
The units sector took a bigger hit, with values down 2.1 per cent to be off 2.6 per cent over the quarter. Units have struggled in the face of increased interest in detached houses with prices up 1.5 per cent over the past 12 months.
Rismark's Ben Skilbeck said there had been a definite turnaround across the housing market.
"In an environment of significantly improved consumer confidence, the housing market is responding positively to almost record low monetary policy settings," he said. The higher prices are on top of better auction clearance rates plus a fall in the number of vendors being forced to cut their asking prices to swing a sale.
And it follows figures from the Housing Industry Association earlier in the week which showed the fourth consecutive monthly increase in new home sales.
CommSec economist Savanth Sebastian said the improvement in the sector was coming off a low base. But it was clear that the sector was slowly turning around.
"The fundamentals for housing remain solid and there may be light at the end of the tunnel," he said.
"The substantial cuts to interest rate, rising sharemarkets, strong population growth and improving confidence levels will support activity over the medium term."
The Reserve Bank board meets on Tuesday with markets expecting it to hold interest rates at their current level of 3 per cent.
Homeowners are also expecting the Reserve to leave rates on hold for a second consecutive meeting.
A survey by mortgage broker Loan Market found more than half of its recipients expected the cash rate to remain steady.Spokesman Paul Smith said with many lenders cutting fixed rate mortgages, there was growing interest by borrowers.
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