The inaugural Fast 50 report from information resource Smart Property Investment has highlighted the area as one of the top Australian cities geared for capital growth in 2012.

Property research specialist Louis Christopher said investors were showing interest in Liverpool.

"With a large population and vacancy rates of just 1.4 per cent, along with affordable house and unit prices, Liverpool is seeing a lot of interest from investors right now," he said.

Cities and towns included on the list are assessed on a range of key measures, including population growth, demand for housing, income levels, employment, vacancy rates, previous capital growth and current gross rental yields.

Mr Christopher said it wasn't just Liverpool that could experience a jump in property prices.

He said the broader western Sydney area was also well positioned for growth.

"While western Sydney has often been overlooked by investors, SQM Research has favourable views on the region and believes it has the potential to outperform the majority of other regions in NSW and Australia," he said.

SQM Research expects dwelling prices in western Sydney to grow between 5.1 and 8.1 per cent over a five-year period. Property developer John Sacco, who recently completed 54 apartments in Liverpool's Castlereagh Street, said the city was growing quickly.

"We've built in Liverpool for many years and the population continues to grow," he said.

Tony Pascale, the managing director of PRDnationwide Liverpool Real Estate, said second-home buyers were also snapping up properties.

"They know it's a great investment," he said.

"People are interested in where facilities are.

"We have a big hospital here in Liverpool and commercial and industrial sites are close, as well as Westfield."

Other cities on the list were Penrith and Blacktown.