Townsville's median house prices surged more than 5 per cent in the December quarter, complementing a "solid'' 12 months of property growth in the city.

Latest market research from the Real Estate institute of Queensland (REIQ) has found the average price of a Townsville house rose to $385,000 in the December quarter, up 5.5 per cent.

Burdell house sales led the quarterly charge, up a staggering 20.1 per cent to $460,000, while Aitkenvale, Rasmussen and West End recorded jumps of 18.1, 14.4 and 13.7 per cent respectively.

Wulguru and Thuringowa Central were among a handful of poor performers, falling 5.8 and 3.6 per cent to $325,000 and $332,500.

The performance has seen both council and the real estate body laud the city's economic diversity and growing consumer confidence as Townsville pipped the north's other centres - Cairns, up 4.9 per cent, and Mackay, up 4.8 per cent.

Craig Allom of Ray White New Projects Townsville said the data showed confidence had returned to the Townsville market.

He said Townsville's long-term median price growth was also highlighted in the 12 months to the end of last year, with a ''fundamental'' 1.4 per cent increase recorded.

South Townsville was the period's standout performer jumping 16.9 per cent from $325,000 to $380,000.

''For majorityof 2009, people were feeling very nervous so many buyers sitting on the fence until the economic conditions lifted,'' Mr Allom said.

''During the December quarter, and early 2010, the market has been climbing in confidence.

''The number of first-home buyers last year was good, but it didn't keep the underlining market conditions going.

''Confidence is what keeps momentum going.''

Planning and development committee chairman Cr David Crisafulli agreed, saying the data was a ''sign of faith'' in the local economy.

He added ''now was the time'' to invest in the city ahead of 3RAR's transfer from Sydney to Townsville in early 2012.

The transfer will see an extra 800 soldiers and 2000 people - the equivalent of a year's population growth - arrive in one hit.

''For us to grow over the year like that is a glowing endorsement on the economic diversity of the city,'' he said.

''It should also encourage those who have been debating whether to buy their first home or an investment property to do so, because there is no doubt that the city is on the cusp of continued strong growth.

''I have no doubt that we have under-supplied the number of homes we need heading into the arrival of the new battalion, and that will lead to increased housing (prices).

''So there has never been a better time to invest or a better city to do it in than Townsville right here, right now.''