Australian property is unlikely to see significant capital growth until next year, according to the latest RP Data/Rismark projections.

Rismark managing director Christopher Joye commented that the market is likely to remain flat for the rest of 2010 - and could even decline if interest rates start rising.

"Following hawkish RBA remarks, economists are now predicting we'll get four to six cash rate hikes," said Joye. "If the resources boom combined with frisky consumer spending compel the RBA to lift the csah rate four to six times by end 2011, we would expect to see nominal dwelling values decline modestly."

He added that, in the five instances since 1993 when the RBA has lifted the cash rate sharply, national capital city dwelling prices have flatlined or declined.

"If the RBA raises rates, there is no reason to expect 2010-11 to be any different," concluded Joye

Even so, he cautioned borrowers to be prepared to service rates that are up to 1.5% higher than what they may currently be paying on their mortgage.

The RP Data-Rismark figures for August show an overall seasonally-adjusted decline of 0.2%, while regional markets remained flat. Canberra dwelling prices saw the largest growth during the month, increasing by 1.2%, while Sydney showed minimal growth of 1.2%. Property values in Perth suffered most in August, with RP Data recording a fall in median values of 4.8%.