Low interest rates 'make Australian property affordable'

While other economies have struggled during the recession, Australia's has remained resilient, keeping its housing market strong while others have floundered.

According to a report by the Sydney Morning Herald, Australia's low interest rates mean that housing in the country has remained affordable to many, leading to the Reserve Bank raising rates six times since October 2009.

However, despite the market remaining strong at the present moment, property investors are watching Australia's housing market carefully.

Banking analyst Brian Johnson said he believed rising interest rates would bring the Australian market more into line with the rest of the world and said it was not without risk.

The news comes as figures from the UK house price index from the Department of Communities and Local Government indicates that UK house prices are once again on the rise, meaning the market is 11 per cent above where it was this time last year. The report also showed that during May the number of mortgage completions increased.

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