Andrew Wilson: Canberra leads capital pack

The Canberra housing market has led the pack over the March quarter, recording the strongest price growth of all the capital cities. Canberra’s median house price increased by 5.3 per cent to a record high $705,059.

The latest house price growth rate was the highest ever recorded by the Canberra market over a March quarter, with the median surging by $66,345 over the past year.

Canberra regions reported mixed house price growth results over the March quarter with the top performer Gungahlin increasing by 7.7 per cent to $670,500. Next highest was Belconnen up 6.4 per cent to $565,000 followed by Tuggeranong up 3.8 per cent to $550,000, Woden Valley up 1.8 per cent to $838,750, Canberra Central down by 1.3 per cent to $952,000 and Weston Creek, where the median house price fell by 1.5 per cent to $654,750.

Canberra’s regions, however, have all reported strong house price growth over the past year with the top performer again Gungahlin up by 15.6 per cent. This was closely followed by Woden Valley up 15.4 per cent, Tuggeranong up 11.1 per cent, Weston Creek up 10 per cent, Belconnen up 9.7 per cent and Canberra where the median house price has increased by 9.2 per cent over the past year.

Low mortgage rates have been a key catalyst for strong house price growth in the Canberra market over the past year. Next week the Reserve Bank meets to determine official rate settings for May with rates likely to again remain on hold over the month at the record low 1.5 per cent.

Latest national economic data will support the steady rates case with underlying inflation increasing over the year ending the March quarter by 1.7 per cent. Although the March result is the second consecutive annual quarterly increase, underlying inflation over the past year remains the lowest on record.

Dr Andrew Wilson is Domain Group chief economist. Twitter: @DocAndrewWilson Join on LinkedIn and Facebook at MyHousingMarket.