'A stark contrast': Buying and selling in Canberra's current market

The market in Canberra has changed a lot in the past year, and with it, so have the experiences of buyers and sellers. 

Canberra’s median house price dropped by the steepest percentage on record over the September quarter, still remaining over the million-dollar mark but falling by 5.8 per cent to $1,096,114, according to Domain data. 

More data revealed October’s median auction clearance rate was 65 per cent, down from 88.1 per cent at the same time last year.

Richard King of Bastion Property Group said the change in the market was a natural response to the “monumental growth period, coupled with significant changes to monetary policy” over the past few months. 

“The level of competition we became accustomed to experiencing on almost all properties [during the pandemic] is now reserved for homes that offer unique or distinctly desirable qualities,” he added. 

“The appreciation of quality products within our industry has made a triumphant comeback as consumers search for solutions that will protect their interests … a stark contrast to the behaviour we experienced during the boom period.

“A cooler market has reduced the perceived pressure felt by purchasers, and there has been a dramatic shift in expectations around price and quality too.”

The rising interest rates have only further influenced the market to change, with the likelihood of buyers participating within it relying heavily on their access to finances, King added. 

“Whilst [changing borrowing capacity] has affected the value of homes across the capital, many buyers have also found property prices have not corrected as quickly as their borrowing capacities,” he said. 

“Many have been faced with the decision of making compromises on certain aspects of a home and commit to a purchase, or to roll the dice and hold out for a property that will better suit their needs.” 

Seller experiences have been equally as impacted by the market and the uncertainty that has come with it, according to David Stokes of Blackshaw Manuka. 

“This unpredictability has caused significant fluctuations in activity from buyers and sellers, following the change in buyer sentiment as interest rates have risen,” he said. 

“However, sellers are approaching the market with a clearer picture around prices now, and those sellers who were capitalising on prevailing conditions are holding the fort.

“With that said, buyers are more strongly educated on the market value of homes they are interested in, following some consistency in results from recent months.” 

While King believes the market will likely continue to slow down into the new year, Stokes said he expected the busiest period in Canberra’s housing market to pull through. 

“I expected to see a flurry of renewed activity early next year, as is consistent with a standard Canberra market,” he said. 

“It will remain to be seen what kind of effect this will have on prices.”