Canberra property market ready for a rebound

Canberra’s house prices are set to enter the early stages of recovery over the 2025 financial year, albeit slowly, according to the latest Domain House and Unit Price Forecast.

Domain chief of research and economics Dr Nicola Powell said the nation’s capital had struggled to move into an established recovery and would continue in a moderate trajectory.

“Even if the upper growth range materialises, [median] house prices will remain $85,000 below the mid-2022 peak … forecast to be between $1.05 million and $1.09 million,” she said.

“The best-case scenario places house prices almost halfway through recovery.”

Canberra’s median house price is currently $1,049,719.

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Powell said unit prices were forecast to increase between 1 and 4 per cent to sit between $571,000 and $588,000.

“Unit prices will still be $38,000 to $55,000 lower than the September 2023 record, at best positioning the city just over one-third into a recovery,” she said.

The report revealed house and unit prices in most capital cities may reach record prices by the end of FY25, apart from Canberra and Melbourne.

The combined capitals (led by Sydney, Adelaide, Brisbane and Perth) would be the centre of price gains, it said, with a slower pace of growth across the regions.

Constrained supply is expected to be the predominant factor influencing property prices in the short term, leading to continued price increases across most cities over the coming financial year, amid a scarcity of land, weak building approvals and high construction costs.

The report stated that a growing population propped up by strong migration continued to be the wind in the sail of property price growth.