The RP Data-Rismark July home value index, issued today, showed dwellings in the capital recorded a 2.5 per cent growth over the past month.

The growth is above the eight capital city aggregate of 1.6 per cent for July.

Canberra has also retained its status as the second most expensive city with a median dwelling price of $500,000, behind Sydney which stands at $570,000.

RP Data research analyst Cameron Kusher said the housing market was driving the growth in the territory as units had fallen in value during the month.

Houses increased in value by 2.8 per cent while units fell 1.6 per cent.

“It's probably a bit surprising how strong the Canberra housing market is holding up given there is a federal election coming up sometime later this year,” Mr Kusher said.

“I think most people think there's probably going to be some public sector job cuts which may have an impact on the Canberra housing market.”

But he said the trend data showed the city was performing “about middle of the rung” when compared to other capitals.

Canberra recorded 4.1 per cent over the past year which was just below the combined capitals growth of 4.9 per cent.

Houses recorded 4.5 per cent growth in this time while units fell 0.8 per cent.

Mr Kusher said while it was clear the market was in a recovery phase it remained to be seen how long it lasted.

“I don't think growth in Canberra is going to be particularly strong over the next six months and that's really just linked back to the election and then what happens thereafter.”

Nationally the July results take the rolling quarterly change in capital city dwelling values to 2.3 per cent and values are 4.9 per cent higher over the past 12 months.