The weighted average price of established houses in Australian capital cities rose 4.2% in the second quarter from the first quarter, the Australian Bureau of Statistics said.
Economists had expected a rise of 2.0% in the second quarter from the first.
The bureau's house price index also showed the weighted average price of established houses in Australia's eight capital cities was down 1.4% from the year earlier quarter of 2008.
The house price index for Sydney rose 4.9% in the second quarter, and fell 0.9% from a year earlier. Melbourne city had the largest quarterly increase, of 5.2%.