The last seven years has seen Canberra’s house values on an upward trajectory, with the capital tracking 0.3% growth throughout the March quarter, according to Domain’s house price report.
Unit values on the other hand haven’t been as prosperous with Domain’s report stating that prices softened by 5.2% over the quarter and ‘had their steepest annual fall in roughly two decades, down 4.3 per cent’.
“The ACT market tracks pretty closely with the Canberra - Queanbeyan market. And both are quite hot,” head of research at Select Residential Property, Jeremy Sheppard shares.
“In fact, they have the highest average demand to supply ratio of any state or state capital in the country – both over 60.”
Remaining stable from its 0.6% rise in values over March as per CoreLogic’s Home Value Index, the fuller effects of the pandemic on Canberra are yet to be gauged. At this moment however, according to Herron Todd White’s residential report for May, agents have reported that ‘most purchasers are finance ready and able to compete with confidence in the market’.
Good long-term prospects
Longer-term, Canberra is well-positioned to weather the risks of the pandemic-led impact on the housing market
The fundamentals are very strong for the medium- to long-term in certain Brisbane, Canberra and Adelaide sub-markets, says Richard Sheppard, chief property investment advisor at inSynergy. Canberra, in particular, possesses robust yields, ranging from 4.5% to 6%, which makes it attractive to property investors.
“We also believe the risk of COVID-19 pushing these markets backwards is quite low,” Sheppard says.
A recent market report from Herron Todd White adds that the Canberra residential property market has been historically stable, reporting consistent growth. It has strong market fundamentals that include low unemployment, above-average annual incomes, and a strong government and public sector employment base.
“We don't tend to see the spikes and falls like some other markets but general stability,” says Angus Howell, local expert at Herron Todd White.
“The outlook for the remainder of the year is difficult to predict. The landscape changes very quickly; however, the stable market conditions mentioned hold the Canberra residential property market in good stead.”