Housing market data from CoreLogic this morning made one thing clear: Sydney and Melbourne property prices are back on the rise.

For the month of August, dwelling values were up 1.6 per cent in Sydney and 1.4 per cent in Melbourne — easily outpacing the national average of 1 per cent across the combined capital cities.

And while it’s a different market — in terms of both size and liquidity — to stocks, property outperformed the ASX in August. The All Ords fell by 2.9 per cent as a bevy of macroeconomic headwinds weighed on risk appetite.

The post-election housing turnaround has — at least for now — put a halt to one of the most extended downturns in history for Australia’s major east coast markets, after Sydney house prices first began falling in September 2017.

But since the May federal election, the RBA has cut benchmark interest rates twice — to a record low of 1 per cent — in response to a slowing economy and persistently low inflation.

CoreLogic head of research Tim Lawless also attributed some recent buyer confidence to the federal government’s personal income tax deductions announced in the April budget.

Along with rate cuts, regulators have loosened their grip on the property market this year, as APRA removed the lending restriction which capped interest-only loans at 30 per cent of all new loans issued. The banking watchdog also eased stress-test standards in July for new home-loan applications.

While house prices in Sydney and Melbourne rebounded, Australia’s two-speed housing economy was in full effect as prices in Adelaide, Perth and Darwin all fell.

Brisbane prices crept higher by 0.2 per cent while Hobart and Canberra continued their steady pace of growth.

Although the heat came out of Sydney and Melbourne over the past two years, on multiple metrics Australia’s household debt levels more broadly remain historically elevated.

And some market commentators have highlighted the tricky balancing act faced by the RBA, as lower rates give rise to another house price surge.

The problem is, the central bank needs to try and kickstart the economy, with Q2 GDP figures on Wednesday expected to reinforce fears of a continued slowdown.

Various macroeconomic risks at the start of last month drove a sharp selloff in riskier assets such as shares, as the ASX Small Ords suffered consecutive falls of more than 2 per cent on August 5th and 6th. The index finished the month 4.2 per cent lower.

With such a complex financial picture, it will be interesting to monitor the relative performance of property vs shares as the 2019 calendar year starts drawing to a close.