The recent rise of house prices in Australia is not unusual compared to past trends, according to a new report released by the Australian Bankers' Association (ABA).
While low interest rates have been the main driver of house prices, it is also contributing to the strong state of household finances indicating the ability to withstand interest rate rises, ABA chief executive Steven Münchenberg said.
"The value of household assets is greater than the value of household debt — for every $1 of debt held by Australian households today, they have almost $6 of assets," he said.
The housing report found that the current price growth still has not exceeded the peak rates that were seen before the global financial crisis (GFC).
"Over the past ten years the price increase in Sydney is unremarkable when compared to other capital cities," Münchenberg said.
"Since the GFC, volatility in prices has increased, with two periods of quite marked national declines in prices followed by strong rebounds."
Since 2008, property prices in Australia has risen 28 per cent, similar to Canada and Norway where property prices grew by 29 per cent and 34 per cent respectively.
The report also covered the supply of housing relative to demand and the role of domestic and foreign investment.