Canberra house prices: Median stabilises after months in the doldrums

Canberra’s median house price increased by 1.8 per cent over the September quarter to reach $1,042,730 after remaining stagnant at $1,024,648 for the previous two quarters, the latest Domain House Price Report has found.

According to the report, the current median house price is still 2.9 per cent down on its September 2022 high of $1,073,708.

It was a different story for unit prices, which continued to fall over the September quarter, dropping 0.6 per cent to $567,059. However, the depth of the downturn has eased when compared to the previous quarter, helping to slow the annual pace of decline.

Agent Teams’ Steve Lowe said that, with interest rate rises on hold, the market had become more stable, and people were confident in making purchasing decisions.

He added it wasn’t surprising that the unit market saw a decline in the median price.

“Investors are getting out of the market as it has become prohibitive due to higher costs and changing regulation, so there is more stock on the market to choose from,” Lowe said.

Domain chief of research and economics Dr Nicola Powell said Canberra was still lagging after experiencing the steepest upswing and then the steepest downturn it has ever recorded.

“Canberra has never seen such a price cycle before,” she said. “It’s hard because it’s such a change in affordability and there’ll be an element that that market is recalibrating.

“We’ve now started to see prices rise and I think it’s officially bottomed out, but it is the furthest from its peak out of all of the cities.

“It still has a significant amount to go; it’s only just started to move into recovery mode.”

The Domain report found that, on a national basis, Australia’s housing market has almost fully recovered from the 2022 downturn – only about $2000 separates house prices from a new record – and $5000 for units – across the combined capitals, an outcome set to be achieved by the end of 2023. The recovery moved through its third quarter of growth for houses and second for units, up respectively by 1.9 and 1.8 per cent over the September quarter.

Weaker conditions are evident in the smaller capital cities, such as Canberra, Hobart and Darwin. Canberra was the final capital city to reach a price trough and has the most to recover, followed by Hobart and Darwin. However, September’s quarter confirms all Australian capital cities are in recovery or at a price peak.

The number of new listings have improved, and September’s auction volumes reached a 16-month high. This boost in new listings has pushed total supply above the five-year average in Canberra. Nationally, total supply is now 5.1 per cent above July’s low (6.5 per cent higher across the combined capitals), although it remains lower annually and compared to the five-year average.

New listings in Sydney, Melbourne, Canberra and Hobart are higher annually.