All signs point to an early bottoming out of the housing markets in the major cities, according to the Australian Financial Review (AFR).

Corelogic’s data has shown a consistent easing in house price falls this year, suggesting the worst of the decline in Sydney and Melbourne is behind us, while prices are rising in the smaller capital cities. Vacancy rates are low and falling in most cities and there is solid rental growth in six of the eight capitals.

SQM Research’s latest data shows annual price growth in Canberra, Hobart, Brisbane and Adelaide and improved figures (though still slightly negative) for Perth and Darwin. “When you add this to other crucial data points, such as historically low unemployment and historically low interest rates, it begs the question as to whether the economic outlook is skewed too far in the pessimists’ favour,” the AFR says. The cash rate is at a record low of 1.5% and banks have been making “out of cycle” reductions in mortgage rates. Unemployment is still low at 5% and there is enough employment growth to at least see wages increasing at 2.3%.