Renewed confidence is underpinning a surge in values.

THE REIV's September Quarter Property Update shows the median price of a Melbourne house has reached $480,000, an increase of 6.7 per cent since the June quarter and a record.

Key factors influencing the result include improved confidence in the Victorian economy and ongoing population increases stimulating demand for housing.

The results have also been analysed by the method of sale, comparing houses or units that were sold by auction and those sold by private sale.

With about 70 per cent of all houses in Victoria sold by private sale, analysis of the broad outcomes from the different methods can provide prospective vendors with an additional piece of useful information when considering the sale of their own home.

In reviewing the statistics, it should not be assumed the results apply to all properties; rather, they are an indication of differences between demand in different market segments.

During the quarter, the best appreciation was recorded in detached houses sold at auction.

The median price of a house sold by auction increased by 6 per cent in the quarter, from $585,000 to $620,000; houses sold by private sale recorded a 3.1 per cent increase, from $411,900 to $424,500.

This highlights the fact that the more expensive the house, the more likely it is to be sold by auction than private sale.

Similar results were recorded for units and apartments.

The median price of a unit or apartment sold by auction increased by 4.9 per cent from $432,000 and by 2.9 per cent from $375,000 when sold by private sale.

More details about the September Quarter Property Update, including suburb-by-suburb results, are available at reiv.com.au.