New analysis by property market research firm Propertyology has revealed the markets with the best upside potential over the short- to medium-term.
The analysis found 53 locations on the cusp of stronger market conditions.
Propertyology Head of Research Simon Pressley said the lag in property data meant prices had yet to officially firm significantly in many of the locations but positive macro changes meant the signs of improvement were real.
"The analysis found that fundamentals of Hobart and Canberra continue to be the best of all capital cities with recent positive macro changes for their property sectors likely to see their price growth rates accelerate," Mr Pressley said.
"Perth, Brisbane and Adelaide are all at the right stage of the property cycle with balanced supply and housing affordability.
"While Propertyology believes they will all produce some growth over the next 12 months, it's unlikely to be anything spectacular until such time as there is tangible proof of a meaningful lift of private-sector job growth."
Mr Pressley said a plethora of regional locations held the best prospects for capital growth with affordability only one part of the equation.
"One such example is the New South Wales university city of Armidale in the New England region," he said.
"It has already seen a significant reduction in real estate selling times, tightening vacancy rates, and has an admirable list of major projects, which is fuelling job growth and community confidence.
"The median house price in Armidale has increased by an impressive annual average of 6.2 per cent over the past 20 years and still sits at an affordable $350,000."
The research found other regional NSW locations with positive trends showing up in a few metrics in Wagga Wagga, Coonamble, Parkes, Murrumbidgee, and Dubbo.
"Regional property markets which support precious metals such as gold and copper are strengthening and include Mount Isa, Charters Towers, Orange, Cobar, Swan Hill, Bendigo, Kalgoorlie, and Roxby Downs," he said.
The coal sector is currently strong in locations such as Mackay, Moranbah, and Emerald in Queensland and Muswellbrook in NSW he said, so there was no reason why these markets wouldn't perform well in future.
"Likewise, expansion within Western Australia's iron ore and lithium resources sector is fuelling improved property market performance in Port Hedland, Newman, Karratha and Bunbury," he said.
The analysis found that Bendigo in Victoria was a standout for its tight vacancy rates, growth in job advertisements, and a reduction in the average number of days for houses to sell.