Which city has Australia's most expensive housing?

Which city has Australia's most expensive housing?

Australian capital city home prices have risen more than five per cent in the past year, with the Sydney and Perth property markets leading the charge.

According to the RP Data-Rismark Home Value Index released on Monday, home prices across the eight state and territory capitals rose 5.3 per cent in the 12months to August.

Perth experienced the biggest increase during the year, with home prices up more than nine per cent, while Sydney's were up seven per cent.

Sydney was again the most expensive Australian city with a median home price of A$587,000, followed by Melbourne at A$507,000 and Canberra at A$503,500.

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Hobart fared the worst, with prices down 1.1 per cent over the year.

Sydney was the strongest performer during the past three months, with pricesup 5.4 per cent in that period.

For August alone, Brisbane saw the biggest price increase of 1.5 percent, aturnaround for a city which has lagged since the global financial crisis.

Home prices in Sydney firmed 0.6 percent in August, while Melbourne saw arise of 0.2 percent and Perth recorded a dip of 0.2 percent.

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"The half-a-per-cent gain over the month of August is a much more sustainable rate of growth and will be a welcome turn of events for policymakers," he said.

Rismark chief executive Ben Skilbeck said investors, rather than owner-occupiers, were likely to drive most of the growth in home prices during the coming months as they took advantage of low interest rates and solid returns.

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"While the owner-occupier segment of the market is more than twice the size of the investor segment, there continues to be a number of indicators suggesting that this spring investors will be punching above their weight," he said.

(Inputs from AAP and Reuters)