Andrew Wilson: Solid seller confidence in Canberra housing market sales prospects

The Canberra housing market continues to consolidate last year’s strong performance with buyer and seller confidence on the rise. Although the current uncertainty surrounding the outcome of the federal election remains a concern it is unlikely to have a significant impact on the local housing market.

The private sale median asking price for Canberra houses increased by 1.9 per cent over the June quarter to $545,000 for an annual rise of 3 per cent. The private sale median asking price for Canberra units was steady over the quarter at $390,000 but has increased by 2.6 per cent over the past year.

New listings continue to test the local market reflecting solid seller confidence in sales prospects. Canberra recorded 510 newly listed homes for sale over June which despite the holiday and election distractions was just below the 590 newly listed recorded over May.

Kingston clearly recorded the highest number of newly listed houses over June with 26 followed by Ngunnawal with 16, Red Hill and Kambah each 13 and Macgregor 12. Kingston also recorded the highest number of newly listed units over June along with Belconnen each with 15 followed by Braddon with 14 and Bruce and Canberra City each with 9.

Low and falling interest rates are a key catalyst of this year’s strengthening Canberra housing market. Although the Reserve Bank has decided to leave interest rates on hold over July at the record low 1.75 per cent, the odds have certainly narrowed for a cut sooner rather than later and perhaps as soon as next month.

The June quarter inflation data due to be released by the ABS on July 27 will provide a key determinant of future rate settings with another low result likely to activate the Bank.

Political uncertainly both locally and internationally can only to the case add to the case for more stimulus to a clearly underperforming national economy.

Dr Andrew Wilson is Domain Group Chief Economist Twitter@DocAndrewWilson – My Property, Radio 2UE Fridays 2-3pm, Saturdays 12.30-1pm