The Canberra suburbs where rents have dropped by as much as 15 per cent

Canberra’s rental prices are edging closer to an all-time high following a period of stability in 2023 but some suburbs are bucking the trend, new data shows.

According to the latest Domain Rent Report, the weekly median rental price for a house is $680 per week, only $10 shy of the record set back in March 2022. 

The story is similar for units, which are back up to a median of $560 per week – a record last set in December 2022.

But there are some areas defying this rising trend, with several suburbs in particular recording a significant drop in house rents year-on-year.

Where have rents dropped the most?

The standout is Deakin where it now costs a median of $895 per week to rent a house, down 15.8 per cent from December 2022. 

Over in Denman Prospect, the average asking price is $700 per week for a house, down 12.5 per cent from a year ago.

The report showed other suburbs in Belconnen, for example, experienced a more modest drop in the median weekly asking rent, though they were still noteworthy.

This included Flynn, which decreased by 7.1 per cent year-on-year, Higgins went down by 6.8 per cent and Page dropped 7.7 per cent. 

Belle Property Canberra and Queanbeyan principal Richard Davies says properties being consistently built in regions such as Weston Creek could account for the more competitive rental prices in that area of the capital. 

“There are a lot of properties available to choose from and [therefore] a lot of choices for tenants,” he says, adding that older suburbs in Belconnen often offer smaller or dated housing stock that is less appealing to tenants. 

‘With plenty of other options, tenants are veering away from these [older] properties.”

What will Canberra’s rental market look like in 2024?

Domain chief of research and economics Dr Nicola Powell believes the nation’s capital is likely to experience much more stable conditions given the vacancy rate now sits at two per cent. 

“We have seen a pullback in asking rents in Canberra because of that vacancy rate increase, and it increased quite quickly,” she says.

“But it showcases that this changeover season in Canberra is going to give tenants much greater negotiation power than they have previously seen.” 

Davies says the impact is already showing across the market.

“We felt this last year when multiple opens were required,” he says. “Our agents are working harder than ever to secure quality tenants.

“A lot of Defence workers seem to be posting in and out, but properties still need to be priced right in the market conditions to secure a tenant.”

While asking prices are unlikely to see big dips, Powell expects the rate of price growth will slow into 2024, and forecasts improved conditions for prospective tenants.

“It’s still challenging conditions for tenants and we can’t shy away from that,” she says. “But what I’m expecting is that the pace of rental growth is still going to be much lower compared to what we saw in 2022.”

Davies says 2024 has so far started strongly.

“Open-home attendance and enquiry are increasing,” he says. “I anticipate this trend to continue as we start to see the effects of last year’s population increase pushing out of the major capitals to the regions.”