After a multi-year slump, national property prices have managed to finally turn a corner to post their first positive month in two years.

Across the country, prices rose 0.1% according to the latest figures produced by real estate research house CoreLogic.

“Our national dwelling value index may have found a floor in July, with dwelling values holding firm over the month following a consistent trend towards smaller month-on-month declines through the first half of the year,” CoreLogic head of research Tim Lawless wrote in his report.

That stabilisation of house prices found support in July as five of the eight capital cities — Sydney, Melbourne, Brisbane, Hobart and Darwin — recorded subtle price rises.

All the east coast capitals recorded a rise of 0.2%, pipped by a 0.3% uplift in Hobart and 0.4% in Darwin.

It’s been the rebound in Australia’s largest two cities, however, that has helped move those numbers higher, according to CoreLogic.

“The primary drivers for the turnaround in housing market performance were Australia’s two largest cities, Sydney and Melbourne, where values have ticked higher over the past two months, taking values 0.3% off their floor in Sydney and 0.4% higher in Melbourne,” the report said.

That’s as auctions in both cities are selling at their highest levels since mid-late 2017.

Lawless echoed other economists in singling out interest rate cuts, the federal election result safeguarding negative gearing and capital gains concessions, and relaxed credit restrictions as being the main drivers behind the property bounce.

While encouraging, the price rise pales in comparison to the 8.3% price decline Australia has seen since peaking, and 6.4% this year.

This year alone, capital cities are collectively down 7.3%.

Future forecasts

As Sydney and Melbourne begin a possible recovery, don’t expect prices to “go off to the races” again, according to AMP chief economist Shane Oliver.

“There’s a bunch of positive factors supporting the property market but I don’t think prices are going to run away because lending standards are a lot tighter this time around,” Oliver told Business Insider Australia.

“I think we’ll spend this six month period between now and the end of the year bottoming out and then you might see modest gains coming in through next year.”

That’s largely in line with the expectation of Commonwealth Bank senior economist Gareth Aird, who is forecasting property markets to largely keep ticking up over the next eighteen months.

_{CoreLogic’s actual home value index figures until June 2019, followed by CBA’s forecasts (Source: CBA)}

“Our base case for property prices in Sydney and Melbourne has them rising by 2.5% and 2% respectively over (the second half of) 2019. Such an outcome would see prices ending 2019 down by around 2% in Sydney and Melbourne,” he wrote in a note released on Thursday.

“For Brisbane and Perth, we see prices tracking broadly sideways over (the second half of) 2019 and lifting modestly in 2020. Nationally, we think prices will end 2019 down by around 2% and see them rising in 2020 by 3%.”