News of the latest rate cut followed the release of independent data yesterday showing property prices had risen for the fourth consecutive month.
The RP Data-Rismark data for last month showed that capital-city dwelling values rose 1.4 cent in September, the largest month-on-month increase since 2010. The report said the results ''cemented'' the fact that a housing market recovery was under way.
Sydney dwelling values rose 1.5 per cent, Melbourne 1.4 per cent and Adelaide 2.4 per cent.
The research director of RP Data, Tim Lawless, attributed the improvement to low interest rates. The growth is in line with Australian Property Monitors' weekend auction clearance rates, which are up to 10 per cent higher than in the same period last year.
The chief executive of Rismark International, Ben Skilbeck, said the growth could not be attributed only to spring enthusiasm.
''Over the four months from end May to end September actual Australian capital city house values have increased by 3.4 per cent. If we adjust this to take into account seasonality, the increase is still a strong 2.9 per cent, which represents an annualised pace of 9 per cent.''
Sydney dwelling values jumped 2.8 per cent over the quarter, which meant a 0.9 per cent growth year on year. During the month houses went up 1.9 per cent, but apartment prices dropped 0.1 per cent.
The chief executive of McGrath Estate Agents, John McGrath, said the data did not surprise him. ''People are putting their homes onto the market and selling them positively, which is affecting the median prices,'' he said.
He was more optimistic about next year, expecting prices to jump between 5 and 8 per cent.
An eastern suburbs agent, David Lee, of NG Farah, also was not surprised by the growth. ''Four out of five of my auctions in the past month have sold for in excess of the reserve price,'' he said.
An art gallery owner, Josef Lebovic, and his wife, Jeanne, sold their Kensington home on Saturday for $105,000 over reserve. ''We felt it was a very good result,'' Mr Lebovic said.
An auctioneer, Damien Cooley, said his clearance rates last month rose from 60 per cent to 62, despite a 52 per cent lift in the number of auctions. ''Without any doubt, there is an increase in buyer confidence,'' he said.