Australian home prices stayed strong in September, driven by soaring demand and outweighing the impact of the central bank’s aggressive policy tightening campaign.

Sydney prices, the national bellwether, advanced 1%, down slightly from the previous month, property consultancy CoreLogic Inc. said in a report Monday. Adelaide led September’s gains — climbing 1.7%.

In the more expensive cities — Sydney and Melbourne — the broad middle of the market is recording the highest growth rate after previously being led by the upper quartile, CoreLogic said. Regional markets continue to lag capitals.

“Possibly we are starting to see renewed affordability challenges deflecting more demand towards the middle of the market where barriers to entry are lower,” said Tim Lawless, research director at CoreLogic.

The Reserve Bank has raised borrowing costs by 4 percentage points since May last year to take the cash rate to its highest level in over 11 years. The unexpected recovery in the property market is a potential worry for policymakers as households feeling wealthier are more likely to spend, adding to inflation pressures.

Despite the RBA’s concerns about housing, the bank is expected to leave policy unchanged for a third straight meeting this week as it assesses the impact of its tightening to-date.