Upgraders push house prices to all-time high

House prices have reached a record high in most Aussie capitals as a result of buying in more expensive suburbs.

An Australian Property Monitors (APM) report found that the outlook for prices remains strong as the population grows, incomes rises and housing demand outstrips supply, the Australian Associated Press reported.

According to the report, 2009 ended with the biggest price growth since 2003 as median national house prices rose 4.8 per cent in the December quarter. This brought the rise for the year to 12.1 per cent.

Hobart saw median house prices rise by more than 14 per cent in 2009 while Adelaide is the most affordable capital after recording the slowest median annual growth for prices at 2.4 per cent.

The APM noted that property upgrading in wealthier areas had driven the increase, thanks in part to a resilient job market at the end of the year.

Rising prices may encourage Aussies to compare home loans in search of the best deals. Earlier this week, the Age reported that a range of second-tier lenders including Liberty Financial and Credit Union Australia are returning to the home loan market as the global financial crisis begins to reside.

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