Market Report ACT - (April 2009)


The ACT has seen both monthly and quarterly growth in its property values through April, seemingly elusive to the negative price drops of neighbouring states.

A lot of it has to do with the fact Canberra has missed any pricing boom in recent years, but also due to the fact employment has been solid here. The April unemployment rate for the ACT was 2.9% according to the Australian Bureau of Statistics, well below the national average of 5.6%.

That's likely to drive more confidence as those locally employed to go for a property purchase.

"Canberra's real estate market has proven to be resilient, despite the economic slowdown that has embraced most jurisdictions in Australia," says Paul Powderly, chief executive of Colliers International Canberra.

According to RP Data, Canberra units showed the least discounting of any Australian capital, selling for the closest to the original list price. While most cities were between 6% or 7% discounting for units, RP Data's February data showed Canberra was at 3.6%. Canberra was second best for houses at 5.5%, only showing slightly more discounting in list price to purchase price than Darwin, at 3.8%.

But without the stability of public sector employment, Canberra's housing market would be in a much different situation, says Liam O'Hara, senior economist at Reality Economics. He reckons Canberra's market has reached beyond its real value.

"Incomes in Canberra are the highest in the country, due to all the public servants there, and consequently, the prices have been way overvalued," O'Hara says.

But for now, that variance is likely to stay the same, as long as the government remains centred there.

"I don't suspect prices will fall anytime soon," O'Hara admits.

Besides jobs, there are some positives going for the Canberra lifestyle, however. A May ABS report says it is the most cultured place in the nation. That's based on the ACT having the highest attendance rate, 90%, of its residents at cultural venues, out of all states and territories.

Canberra, home to two major schools in University of Canberra and the Australian National University, will also benefit from the latest federal budget with more than $2bn to higher education.
The Australian National University has been allocated $150 million in capital funding, likely to spur greater enrolment numbers over the long run.

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