Australian homes have reached a combined value of $11 trillion for the first time but the speed of growth is slowing.
Corelogic data released on Friday showed the annual growth has eased to 6.7 per cent after edging just 1.0 per cent in September quarter.
That's the softest three-month rise since March 2023.
Rental prices barely budged, shifting up 0.1 per cent over three months, the slowest rate since major pandemic lockdowns in 2020.
While the market remains resilient in many areas, the pace of growth more broadly has clearly decelerated, CoreLogic Australia economist Kaytlin Ezzy said.
"Buyers and investors are becoming more cautious, and the current lending environment is leading to more measured purchasing decisions," she said.
As measures to increase housing affordability ramp up in federal parliament, investors are jumping into the market in bigger numbers.
They now make up almost two-fifths of all new home loans, the highest share since 2017.
High investor activity was likely due to a combination of perceived opportunities for capital gains, tighter rental market conditions and other factors, Ms Ezzy said.
More available stock was also providing better opportunity to enter the market, but that could intensify competition for first-home buyers, she said.
"This increased investor activity could place further pressure on already limited supply levels, particularly in capital cities."
The federal government this week reintroduced a bill that would allow first-home buyers to buy a property with a smaller deposit.
Efforts to pass the Help to Buy shared equity scheme had earlier been delayed by the coalition and Greens, with the latter claiming the changes would only worsen the ongoing housing crisis.
The coalition wants to see Australians allowed to dip into their superannuation to help boost a home deposit.
Debate has also raged over the future of negative gearing, with a recent national poll suggesting most Australians want it wound back but are divided on how.
A battle over limited housing is helping catapult Perth home prices to new heights.
The western capital city has experienced annual growth of 24.1 per cent, driven by sustained demand and limited supply.
Sydney, Brisbane and Adelaide are also at record highs but Melbourne and Hobart have kept falling from 2022 highs.
