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Mining towns account for nine out of the 10 Australian suburbs recording the strongest median property price growth, as the recovery in the property market takes hold.

A suburb of a city that’s home to one of the world’s largest lead smelters and another in a once-struggling steel city are among those experiencing a pricing surge, as record-low interest rates and an easing of bank-lending rules support demand. 

“Rental growth in many of these places has been strong for quite a while now. It is now flowing through to pricing, likely driven by greater investor demand,” REA Group Chief Economist Nerida Conisbee said.

Risdon Park South, a suburb of Port Pirie, the South Australian location of Nyrstar NV’s smelter, registered 71% median price growth year on year in the 12 months to August 2019, according to the latest data from Hometrack Australia.

A 42% jump in price was registered in steel town Whyalla Norrie, where the median house price was A$138,000 ($94,500), and in the coal mining town of Blackwater, Queensland, prices surged 41% during the period, with 51 properties changing hands. Other mining centers in the top 10 include Newman, Quarry Hill and Dysart.

“Mining towns are definitely having a moment,” Conisbee said.

The figures follow the latest CoreLogic Inc. data that showed Australian house prices rose the most in almost 2 1/2 years in August, amid the backdrop of an economy that expanded at the slowest pace since 2009 in the second quarter.

The turnaround in established housing markets was also acknowledged by the RBA on Tuesday. Still, the central bank also noted that new dwelling activity had weakened and housing credit growth remained low.

(By Rebecca Jones)