ACT apartment market tops Australia

Canberra’s apartment market is the best performing in the country, but the industry is warned not to expect strong gains in the near future.

Year-on-year data for Canberra units recorded an increase of 6.6 per cent in value, the highest rate among the capital cities, according to figures issued by RP Data-Rismark on Friday.

Values also increased by 2 per cent over the quarter and the median price, based on settled sales over the three-month period, was $410,000.

But some sectors of the market remained soft, Real Estate Institute of the ACT director Craig Bright said. “It’s held up well in terms of first and second-home buyers. But the upper end of the apartment market is a bit softer.”

There were pockets of oversupply, but Mr Bright said most sales for current projects were settled. “You see a lot of these buildings go up, but a lot of them are already presold. The vast majority will be occupied from day one.”

Nationally the housing market had been moving towards recovery since June, RP Data research director Tim Lawless said, adding

the trend was expected to continue, but gains were not likely to be as high in the coming months.a

Hopes for strong gains were also dismissed by ANZ researchers, who said job security concerns would continue to hold back consumer confidence. They said household caution and a reduced debt appetite would also limit demand.

“While these price gains are encouraging, January data should be treated with some caution given relatively thin trading volumes,” the researchers said. “Buyer sentiment remains subdued. Much of the pick up in sales to date has been driven by investors, with modest gains in upgrader demand more recently.”

According to the RP Data-Rismark figures, Canberra’s house market had performed well, recording higher rates of increase in value than the average of the capital cities.

House values were up 1.7 per cent over the quarter and 2.4 per cent year on year. The median house price was $575,000, the third priciest behind Sydney and Darwin. The median dwelling price was $537,500, up $20,000 from last month.

The figures differed slightly from The House Price Report, issued by Australian Property Monitors on Thursday. It said price rises for both property types were above the national rates of growth over the quarter.

Its data was based on a sample of prices, while RP Data-Rismark used all settled sales.