Home values are rising faster for relatively affordable properties priced below the threshold for the Australian Government 5% Deposit Scheme compared to homes that are too expensive for the scheme.

Experts report an increase in activity from first home buyers since the scheme expanded last month, but researchers caution that affordable properties have been rising strongly in price for some time, also buoyed by investor demand and restrictions on home lending.

Dwellings with an estimate within the price caps of the scheme rose by 1.2 per cent in value in October, Cotality figures show. Dwellings above the cap rose by 1 per cent. The gap may seem small, but it is relatively strong historically, the research house said.

The scheme, which allows first home buyers to purchase with a low 5

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