Canberra home sellers raise their price guides after listing as housing market booms

Canberra property sellers are increasing their asking prices in the middle of the marketing campaign as booming market conditions and buyer demand encourage them to bump up their price expectations, new data shows.

New Domain data revealed that Canberra sellers increased their asking prices on 4.3 per cent of homes for sale in April during their campaign, whether it was a private treaty sale or an auction.

This figure has edged back from its peak in December when 6.4 per cent of homes for sale increased their price guides, although it remains elevated compared with this time last year.

Price guides are increased mid-campaign when buyer feedback is above the guide, or a higher offer is placed.

It comes after median house prices in Canberra recorded the steepest annual growth rate in 17 years, hitting a record high of $927,577.

Domain senior research analyst Nicola Powell said there was a relationship between price edits upwards and the median price growth felt in the Canberra market, but that was expected to soften in the coming months.

“This means when we see more homes for sale with asking price hikes, we would then see price growth gain momentum and vice versa,” she said.

“Those conditions early in the year were unique and rare, and I think those conditions are starting to ease, more so in Sydney, but I think that could be the case in Canberra, too.”

The region leading the price increases in the ACT was Molonglo Valley, where 7.5 per cent of listings hiked their price guide. 

This was followed by properties in Belconnen, where 5.2 per cent of listings had a price increase, and the Inner North, where 5.1 per cent also saw a lift in April.

“When you [look at] Canberra regions, all of them are coming off their peak [from December 2020] apart from Inner North where it’s edged higher over April,” Dr Powell said.

“We’re starting to see a decline in the percentage of listings [where] the asking price has been edited higher.”

Steve Lowe of Agent Team Canberra said bumping up price guides was a reflection of the moving market.

“In previous years, we’d find that we’d have to adjust price guides and sell at an expectation downwards to meet the market,” he said.

“Today, records are being set almost every day in Canberra, so when we’re guiding our sellers, we give them up-to-date sales data including comparable sales in the suburb.”

Bree Prince of Hive Property has rarely had to change price guides mid-campaign in a bid to allay seller and buyer frustration.

“With how Canberra’s property market has performed recently, it’s very important to manage a seller’s expectation,” she said.

“If we have a campaign going on and if there’s been a lot of interest for it and the feedback was higher than we expected, then we’d increase the guide to be more realistic and make sure that it aligns with what we think it’ll end up selling for, but we try very hard to value it as close as possible from the start of the campaign to avoid that.”

Mr Lowe has held shorter-than-usual auction campaigns recently to reflect the fast-moving market. However, he’s dealt with sellers whose expectations have risen during the two-and-a-half week auction campaigns.

“Because vendor expectations have gone up, we’re finding that it takes a lot longer to hit that reserve at auction,” Mr Lowe said.

“A few weeks ago, we were exceeding their reserve immediately with the first bid, but we noticed that in the past weekend, the properties we sold under the hammer only just hit the reserve.”

With the winter season just around the corner, the number of properties available will soften; however, the demand will remain, Mr Lowe said.

“We’re already down on stock as we speak, but the level of demand is still the same, and I think that will remain into winter. I don’t think we’ll see a plateau in prices until more stock arrives,” he said.