Housing market's best year in four years Low interest rates have helped boost property prices almost 10 per cent across Australia in 2013. AUSTRALIAN home prices jumped almost 10 per cent in 2013 and the boom isn't expected to let up any time soon. Sydney's property market was the strongest, helping to deliver the strongest year of national capital city prices since 2009, according to the RP Data-Rismark December Home Value Index. Low interest rates drove the demand for housing last year and the trend is likely to continue in 2014, with benefits flowing through to the rest of the economy, St George chief economist Besa Deda said. House price growth would continue to drive recovery in residential construction, one of the "important ingredients" needed to support the economy as the mining investment boom winds down, Ms Deda said. "Low interest rates, firm population growth and housing shortages among some capital cities suggest house prices will record further gains this year," Ms Deda said. We expect growth nationally of 5-8 per cent this calendar year and these price gains should in turn help underpin household wealth and continue to help foster improvements in consumer confidence. Home values rose by 14.5 per cent in Sydney in 2013, pushing the city's median dwelling price to $655,250, the report said. Home prices in both cities are currently at record highs, up 10.9 per cent and 3.6 per cent, respectively, over prior peaks, the report said. RP Data senior research analyst Cameron Kusher said the gains of 2013 had followed two years of losses.