It's too early to tell if January's market slump is indicative of the property outlook for the rest of the year, according to RP Data.

The research firm's January figures, put together in partnership with Rismark, revealed a 1.6% fall in the national average house price – the biggest fall in five years. Even so, RP Data's research director, Tim Lawless, stressed that January figures are usually low, and had been further impacted by the floods, cyclones and bushfires that have afflicted significant portions of Australia during the past month.

"The volume of sale transactions in January is usually much lower than other months due to the seasonality of the market," said Lawless. "This year the downturn in activity has been compounded by the spate of natural disasters experienced around the country."

Indeed, Rismark joint managing director Ben Skilbeck reckons that early figures from February indicate that the market is rebounding.

"Housing credit growth looks to be rising a little, and the early auction clearance rate data in February have been a demonstrable improvement," he added.

Almost every capital city saw dwelling values fall in January, with Canberra suffering the largest seasonally-adjusted percentage drop of 3.8% over the January quarter. Only Hobart saw a price increase over the same period, recording minimal value growth of 0.6%.

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