Newcastle property prices have again held up strongly under the weight of massive job losses and a renewed coronavirus threat.
Property data from analysts CoreLogic show the median dwelling price rose a healthy 0.8 per cent in July in Newcastle and Lake Macquarie, again defying falls in Sydney and Melbourne.
Prices in the rest of the Hunter fell 0.5 per cent.
Newcastle property prices have remained relatively stable over the past four months, rising 1.4 per cent, despite the loss of 27,500 jobs in the city and 40,000 across the Hunter since February.
By contrast, prices fell 0.9 per cent in Sydney, 1.2 per cent in Melbourne and 0.6 per cent across Australia in July.
CoreLogic head of research Tim Lawless described the impact of COVID-19 on housing markets so far as "orderly".
The monthly sale volume for July continued to rebound from an April low point and is above the average for the past two-and-a-half years.
A recent report by BIS Oxford Economics forecast prices in Newcastle and Wollongong to be "slightly more resilient" over the next three years than those in Sydney.
"Over the long run, we expect median house prices in both regions to dip in FY21 before returning to their FY20 levels by mid-2023," the report said.
It said the short-term outlook for both satellite cities was a "sharp decline" in transaction volumes and prices, but the government's new HomeBuilder package would help sustain land and home values on Sydney's fringes and in Newcastle and Wollongong.
"Underlying demand in both regions is being supported by robust population growth and this could continue in the year ahead as migration to regional areas typically increases when property markets go through difficult times due to better affordability."
Newcastle house price rises and falls have mirrored Wollongong's over the past five years, though the southern city's median of more than $700,000 is about $100,000 higher due largely to its proximity to Sydney.
The Real Estate Institute of NSW's most recent rental vacancy rate report showed only 1.7 per cent of Newcastle rental properties were vacant in June, compared with 4.5 per cent in Sydney and 3.2 per cent in Wollongong.
A rental vacancy rate of about 3 per cent is considered a "balanced" market, suggesting the Newcastle market is heavily skewed in landlords' favour.
Newcastle agent Scott Walkom said the region's biggest employers, the university, health service, mines, RAAF base and construction, had not been greatly affected yet by the pandemic.
"We should do well compared with Sydney over the next three years," he said.
"There's not an oversupply of rental properties, whereas in Sydney it's a drag on the market.
"We haven't had the vacancies. In fact, rental properties are very much still in demand.. We only have eight out of about 800 vacant."
Grants for first-time buyers were helping the bottom end of the market, and the top end was healthy because well heeled buyers had job security and access to low interest rates.