Market struggles to find bottom
Recovery remains fragile as prices fall again during April
Just when you think the downturn in Canberra’s property market is coming to an end, other stats comes out to show otherwise.
During April, Canberra was the worst performing capital city, with dwelling values dropping by 1.5% while the rest of the capitals grew in value according to CoreLogic RP Data.
House values lost 1.4%, while unit values fell by 2.4%. While it’s only for the month of April, the poor performance has cast doubt about Canberra’s recovery.
During the three months ending April, the picture is slightly better for houses. Median values rose by 2% to $590,000 according to the data provider. Units remained in the doldrums, however, with median values dropping by 2.4%.
Despite this uncertainty, Linda Phillips of Propell thinks the market is already improving in general. “Although the recovery remains patchy, investors are picking up on Canberra at the moment,” she says. “We consider the market has found a base and will improve in the next year.”
As such, Phillips believes that investors should consider re-entering the housing market.
“This is the time to move into the market. Well located and popular properties offer good potential.”
Defying a slow market
Despite the broad weakness in the Canberra market, many suburbs have racked up exceptional growth during the past 12 months, including Lyons, Bonner, Kingston, Isaacs, Yarralumla, Weston
, Casey, Wright, Mawson, Macquarie.
“With confidence in the market improving, Canberra in general has better prospects for investment in the next year, though newer properties, or those with redevelopment potential, will do better than average,” says Phillips.
However, Phillips remains pessimistic about the prospect of the unit market over the medium term.
“The apartment market is likely to remain sluggish due to oversupply andweakening employment prospects due to public service cuts,” she says.
SUBURB TO WATCH
Yarralumla: Defying the downturn
Located just 4km from the Canberra CBD, Yarralumla is a beautiful suburb that is considered to be the most desirable place to live, thanks to its proximity to Lake Burley Griffin and many excellent cafés.
Its tree-lined streets are particularly breath-taking during Autumn when the leaves change their colour. The neighbourhood is quiet and there’s plenty of green spaces, making it attractive to families.
While houses in the suburb continue to skyrocket, units have fallen behind. During the past 12 months, median unit values dropped by 5.8% to $774,000. While the overall outlook for the unit market in Canberra remains subdued, it’s worth watching this suburb for buying opportunities. Stick with properties along Maxwell Street, which is surrounded by greenery and only a short distance from the Parliament House. Other desirable streets include Abbott Street, Hopetoun Circuit Exit.
Can you afford to buy in this suburb? Find out how much you can borrow
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