The nation's property markets divided as Perth goes backwards and Sydney gets a "second wind": CoreLogic RP Data

Sydney's home prices increased by 3% over March, according to the latest CoreLogic RP Data Home Value Index.

Meanwhile, price growth was sluggish in the other capital cities, with all others except Canberra recording price growth under 1% for the month. Brisbane saw a slight decline in prices, with an 0.3% decline over March.

Source: CoreLogic RP Data

The result makes Sydney yet again the best performing capital city for the quarter, with overall price growth of 5.8% over the three months to March. Melbourne recorded the next strongest quarterly price growth, with 3.5%.

Sydney's bullish market performance is in contrast to Perth's result. In the Western Australian capital, prices declined by 2.7% over the quarter, the largest price drop of any capital city for the period. Adelaide and Brisbane prices also decreased over the three months, by 0.9% and 0.5% respectively.

Source: CoreLogic RP Data

Sydney's price growth of 13.9% for the year to march was responsible for dragging up CoreLogic RP Data's annual combined capital growth figure to 7.4%, with Melbourne, Brisbane, Adelaide and Canberra the only other capital cities to record positive price movements. CoreLogic RP Data's head of research Tim Lawless said the majority of property price growth recorded since June 2012 has been from Sydney.

"Over the current growth phase, Sydney dwelling values have increased by 38.8% with Melbourne second strongest at 23.6%," said Lawless.

"On the other hand, total dwelling value growth over the current cycle has been less than 10% in Adelaide, Hobart and Canberra."

He noted the combined capital city home value increase of 3% over the March 2015 quarter was lower than the 3.5% growth recorded in the same period last year.

Source: CoreLogic RP Data

CoreLogic RP Data described Sydney's growth trend as "disengaged" from Australia's other capital city markets, noting that Sydney auction clearance rates have exceeded 80% since the Reserve Bank cut interest rates in February this year.

"Since the previous rate cut we have seen auction clearance rates surge higher and activity across CoreLogic mortgage platforms has moved to new record levels," said Lawless.

He attributed Sydney's strong market performance to investment demand. However, he also cautioned Sydney investors.

"With the growth curve in Sydney now well advanced and rental yields approaching historically low levels, prospective investors may be wise to use some caution when considering their investment options," he said.

"When the Sydney housing market starts to lose momentum, there is some risk that recent investors could be left holding a very expensive but low yielding asset with a lower than expected rate of capital gain over the coming years.

"From there it will be interesting to see if they bide their time in the housing market or exit to other asset classes with a stronger return profile."

The median price of a Sydney home now sits at $690,000, with a median priced house costing $781,000. Sydney's median unit price is $600,000.