Despite already being the most expensive place to buy a home in Australia, Sydney continues to break new records, with its median home price up 6.39pc in the past year to $1.107m.

Regional New South Wales is also at a record $729,000 with prices 4.47pc higher than this time last year, according to the latest PropTrack Home Price Index, released Monday. “Sydney home prices grew for the 19th consecutive month in June,” it found. “The increase in properties hitting the market this year has been met with strong demand, driving further price growth. However, the pace of growth has eased steadily since the end of the summer selling season as buyers enjoy more options”.

PropTrack economist Eleanor Creagh said “Sydney is the most unaffordable market in Australia, but still we’re seeing home prices continuing to lift, hitting fresh peaks”.

“It’s likely that the continuous lift in home prices in Sydney is probably motivating many to simply overcome those affordability challenges and transact, given that there is an expectation of continued home price growth. So many may be moving ahead with their purchasing plans sooner than otherwise”. “Mortgage servicing costs have surged, borrowing capacities have reduced significantly and household income growth hasn’t kept up with those increases, so we’re continuing to see a deterioration in affordability.” She said “a lot of existing homeowners in Sydney are likely to be sitting on sizeable equity gains, which is insulating them to a degree from the higher interest rate environment if they’re looking to upgrade”.

Since March 2020, prices have increased by 37.8pc in Sydney and 53.7pc in regional NSW. The capital regions dominate price growth across NSW, led by Inner South West Sydney (up 9.71pc to $1.189m median, South West Sydney saw a 9.59pc jump to $1.041m, Parramatta rose 8.94pc in the past year to $972,000, Inner West Sydney was up 8.11pc to $1.323m and the only regional area in the top five performers was Richmond-Tweed up 7.74pc to $857,000. “National home prices have cycled through 18 consecutive months of growth despite interest rates remaining at this high level and have gone on to hit another fresh price peak in June,” Ms Creagh said.

“It’s certainly no mean feat given it’s been during the most substantial interest rate tightening cycle in a generation.

“And yet we’ve still seen that in many markets home prices have largely recovered the price falls that we saw when interest rates were first rising in 2022 and have gone on to continuously hit fresh peaks.”

Unlike the pandemic era boom, capital cities are now outpacing regions for growth, up 6.91pc versus 5.61pc to $855,000 and $643,000 respectively.