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SYDNEY, March 3 (Reuters) - Home prices across Australia's major cities were flat in February after a run of strong gains, although they remained almost 10 percent higher than a year ago.
Figures from property consultant RPData-Rismark showed overall dwelling prices were up 9.5 percent compared to February
last year, led by 14.1 percent growth in Sydney.
Sydney also saw prices rise 0.8 percent in February, from January, while prices in five other cities fell in the month.
"The likelihood is that the weak reading for February is an adjustment from the strong readings in December and January rather than the beginning of a flat to negative growth phase across the macro level housing market," said RP Data research director Tim Lawless.
Buyer demand remained very strong in February with RP Data's valuation platforms recording a record month for average daily levels of mortgage-related activity. Auction clearance rates were also strong and with little slippage in vendor discounting levels or average selling times.
While higher home prices have stirred talk of a bubble, they are considered by policymakers as necessary to encourage a much-needed revival in home building.
The Reserve Bank of Australia (RBA), which cut interest rates to an historic low of 2.5 percent last August, has been counting on home construction to provide vital support to the economy as a long boom in mining investment cools.
(Reporting by Wayne Cole; Editing by Richard Pullin)
((Wayne.Cole@thomsonreuters.com)(612 9373 1813)(Reuters Messaging: wayne.cole.thomsonreuters.com@reuters.net))
Keywords: AUSTRALIA ECONOMY/HOMEPRICES