Canberra’s million-dollar regions see a drop in house prices

Some of Canberra’s most expensive suburbs have recorded a drop in their median house prices, including in the desirable Inner South, according to Domain’s June 2023 House Price Report.

While prices remained stable in the ACT as a whole, Weston Creek and the Inner South both experienced a drop in their median house price, resulting in the Inner South losing its standing as a $2 million suburb as its median fell to $1.905 million. 

Molonglo Valley, Belconnen and Tuggeranong also recorded a fall in the March to June quarter. 

Real estate agent Anthony McCormack of Hayman Partners has worked across the affected regions for a decade, and said that a drop in supply of high-quality, more expensive listings was having an effect on the median price point in those areas. 

“What we’re seeing at the moment is reduced listings and reduced supply, and that’s having some impact in terms of where buyers are at too,” he said. “I’ve got a lot of buyers asking me, ‘When is the really good-quality stock coming to the market?’

“People are a little less inclined to take a risk on the market, and they’re just a little bit gun-shy of listing at the moment if they don’t have to.” 

Several other factors have also contributed to the shift in the median price, including rate rises and consumer confidence, McCormack said. 

“I think it’s a combination of a few things, really,” he said. “I think interest rates and inflation have really started to bite, and I think that’s just dropped a little bit of consumer confidence, which in turn slows the market up.”  

The Inner North also experienced a quarterly fall, with the median house price dropping 1.2 per cent to $1.23 million. 

Steph Hoss of Belle Property Canberra agreed that rising interest rates and lower stock levels were contributing to the downward shift.

“Having seen interest rates well up from their historic lows, it’s really impacting affordability, particularly in the higher-priced areas,” Hoss said. 

“I think part of the reason that the inner suburbs might not have been performing as well, comparatively, [are] the limited options available to buyers. Stock levels are lower than they have been before.

“If we look at the Inner South and Inner North, they’ve always been more expensive than the outer suburbs, so because people have that limited borrowing capacity, they need to compromise on location and they’re looking at those outer suburbs because they’re perceived to be more affordable.”

The June 2023 report showed those outer suburbs outperformed the more central areas, particularly in the Gungahlin region, where the median house price rose from the previous quarter to $968,000. 

Hoss is optimistic that as the weather in Canberra warms up, so too will the property market. 

“I’m certainly seeing lots more sellers getting ready to come to market in preparation for spring,” she said.