Steady start to Canberra spring selling season but signs point to slowing price growth

Canberra’s property market has recorded a stable start to the spring selling season, but auction clearance rates show the market is not performing as well as it did last year.

Altogether, there were 359 auctions held in Canberra over September with 167 selling under the hammer, a clearance rate of 62 per cent. This reflects a drop of 10 per cent on September 2017, where 72 per cent of the 301 properties auctioned sold under the hammer.

Despite the drop, spring is already showing signs of an improved performance compared to the winter months.

“The beginning of spring saw auction clearance rates improve following a subdued winter performance,” Domain senior data analyst Dr Nicola Powell said.

“Auction momentum has gained a little pace with September’s preliminary clearance rate reaching 62 per cent, following a stable output over the prior three months at 59-60 per cent.

“Anything above 60 per cent means you’re likely to see price growth but anything below [indicates] deterioration, for Canberra this means we are likely to continue to see price growth but at a lower level than that of last year.”

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• Related: Canberra agents give the inside-run on spring bidding 

Further cementing its position as the region with the most successful clearance rate, Belconnen took the top position in September with a clearance rate of 75 per cent – on par with last year.

All other regions recorded a performance lower than last year, with the Inner South recording the greatest drop of 37 per cent to a clearance rate of 50 per cent.

“I think the market [in Canberra] is now not one market, it’s market segments, and there are established areas where there is a lot of competition at auctions,” said Auction Advantage auctioneer Frank Walmsley.

Mr Walmsley said now was the time for buyers “to put their foot down” and buy at auction.

“If you’re a buyer and turn up to an auction where you are the only bidder, it is absolutely your tactical advantage to work to get the property at auction. Falling clearance rates are perfect for buyers to use their advantage to take the property out of the market at auction,” he said.

While clearance rates were down, there were more choices for buyers with the sales supply up for both houses and units.

The total supply of houses on the market over September was 1312, with units 1269. In September last year, there were 1079 houses on the market and 1060 units.

It’s a different story in the rental market, where new supply is down in both the housing and unit market, recording annual drops of 21.1 per cent and 14.8 per cent respectively.

Total unit rental supply in Canberra was the worst affected, recording a drop of 33 per cent.

However, the total supply of rental houses was up 8.7 per cent. Domain is set to release the latest rental figures next week in State of the Market Rental Report for the September 2018 quarter.