Canberra house prices up more than 20 per cent in financial year

Ian Bushnell 8 July 2021 24
1 Austin Street, Griffith

1 Austin Street in Griffith sold for $2.3 million last weekend. Photo: Ian Bushnell.

Canberra home values surged 2.3 per cent in June to take the gain for the financial year to a massive 18 per cent as supply dwindles in the face of insatiable demand.

The latest CoreLogic data shows growth is being driven mainly by the demand for stand-alone houses, with values soaring by 20.7 per cent over the past year.

In a rush to the end of June, buyers delivered a 2.7 per cent spike in house values alone. For the quarter, house values rose 7 per cent, and 14.4 per cent in the first six months of 2021.

Over the financial year, the growth in Canberra house values was second only to Darwin, which recorded a 21.4 per cent increase.

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Last weekend a four-bedroom home at 1 Austin Street, Griffith led the auction results, bringing $2.3 million. The median result was just under the million mark at $931,000 and the clearance rate was 90 per cent. All of the top 10 results were above $1.3 million.

Units and townhouse values also continue to increase, but far behind the rate at which houses are appreciating. They grew a further 0.9 per cent in June for a healthy 8.7 per cent for the past year.

So far in 2020 they have appreciated 5.1 per cent, no doubt fed by some buyers being priced out of the house market and looking to at least get a toehold in an apartment or townhouse they can afford.

Cheap money continues to underpin the market generally, but added to that in Canberra are its stable public sector workforce, COVID-free status and strong local economy.

Canberra was the only capital city to experience a further increase in the monthly growth rate, up from a 1.7 per cent gain in May.

Also, fewer properties, especially sought-after houses, are going on the market. SQM Research says listings are down 26 per cent on the same time last year, second only to Hobart, and 11 per cent fewer in June than May.

CoreLogic Home Value Index tables

The annual growth in Canberra house values was second only to Darwin. Image: CoreLogic.

In June 2020, in the midst of the pandemic, Canberra had nearly 4,000 properties listed for sale. A year later, there were just 2,897, a sign that older listings were being cleared, even accounting for the seasonal winter slowdown.

New listings (less than 30 days) were down 10 per cent on May but up 40 per cent for the year. Older listings (more than 180 days) were down 14 per cent and 54 per cent.

Nationally, home values rose 1.9 per cent in June, for annual growth of 13.5 per cent, the highest annual rate of growth across the Australian residential property market since April 2004.

The seemingly runaway values are again ringing alarm bells about more people being locked out of the market and the consequences a rise in interest rates could have for buyers who may have over-committed themselves.

READ MORE: Stamp duty abolished on off-the-plan home purchases up to $500,000

The ACT Government’s latest tax reforms, in which stamp duty has been abolished for off-the-plan properties up to $500,000, aims to encourage the construction of more affordable homes, and Chief Minister Andrew Barr is calling on the industry to build more of these.

Industry has responded with the long-held view that the government needs to release more land, arguing that it is very difficult to build homes, other than, say, one-bedroom apartments, that can go to market for less than $500,000.

The housing data also comes in the same week as a new report from the Australian Institute of Health and Welfare about the shrinking proportion of social housing, with the ACT having the smallest in the nation.

CoreLogic’s Eliza Owen says there are signs that some of the steam is coming out of the market and that the persistently high growth rates are unsustainable, from both an affordability perspective and renewed headwinds amid a lockdown in Sydney and other parts of the country.

There is also the potential for tighter lending conditions and rising mortgage rates.

“Already through June, several of the major banks have forecast cash rate increases earlier than has previously been indicated by the RBA,” he said.

“A sooner-than-expected uplift in the cash rate would bring forward mortgage rate rises and reduce demand for credit.

“Furthermore, off the back of APRA writing to major lenders to ensure proactive risk management in home lending, there have been early signs of more conservative home loan assessments.”

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24 Responses to Canberra house prices up more than 20 per cent in financial year
assiduous assiduous 1:01 am 09 Jul 21

“A system that raises housing costs for all Australians, that raises instability and lowers productivity does not serve the nation well. And as for rising housing wealth, it is not like the wealth created from effort and innovation, for that creates gains for all. Rather, it makes some Australians, the affluent and older, better off by making younger and poorer Australians, and also future buyers, worse off.”

Anyone who cheers rising house prices is either a greedy sociopath, or an ignoramus.

Ol L Ol L 4:45 pm 04 Jul 21

Best news ever for my retirement

George Watling George Watling 1:12 pm 04 Jul 21

We need to reduce institutional investors access to the Australian residential property market and population growth to ensure we maintain access to home ownership and quality of life in Canberra. Institutional investors access to the residential property market in Australia and high population growth leads to higher density housing. High density housing leads to increase housing prices.

Sam Oak Sam Oak 11:55 am 04 Jul 21


Cameron Dickie Cameron Dickie 2:10 pm 02 Jul 21

basically say goodbye to ever owning a family home.

Ashleigh Jane Sell Ashleigh Jane Sell 1:04 pm 02 Jul 21

I'll never be able to afford a deposit on a loan let alone the repayments

Jack Dean Jack Dean 6:30 am 02 Jul 21

Yeah this is why we'll be building, pay 800-900k for a 4 beddy needing 70k in renos to take it out of the 90s or just build new 🤷‍♂️

    Fabio Fabbo Fabio Fabbo 10:23 am 04 Jul 21

    Jack Dean retrofit is much cheaper, with increased EER and long-term savings on energy bills. There is also the environmental saving on sourcing materials.

    We saved about 45% instead of a knockdown-rebuild

    Jack Dean Jack Dean 11:40 am 04 Jul 21

    Fabio Fabbo we won't be knock down rebuilding we'll just buy a new block and put a house on it haha. Don't wanna spend 800k on a house only to have to renovate it

    Fabio Fabbo Fabio Fabbo 11:50 am 04 Jul 21

    Yes, I understand. We did the retrofit out of necessity... Later our architect won 2 awards for economic retrofit small home and the other a Greensmart award... Now, enjoying the EER comfort and reduced energy bills. Still a mid-70s house on the outside. The retrofit build was $279k to reconfigure the plan, improved insulation etc

Vivian Nguyen Vivian Nguyen 12:44 am 02 Jul 21

Terrence Le should've bought a house

Ganesh Suppiah Ganesh Suppiah 9:07 pm 01 Jul 21

do you accept monopoly money?

    Kondamma Venkatasami Kondamma Venkatasami 2:15 pm 02 Jul 21

    Ganesh Suppiah that is really funny!

    You might get a monopoly hotel/ house

Amy CJ McFarlane Amy CJ McFarlane 7:56 pm 01 Jul 21

I got into the property market literally at the last possible moment for me before it was out of my reach. Every time I see news like this, I honestly just get sad because I know how excited I was and I know how devastating it must be to watch this happen as you’re searching for your first home.

Daniel Duncan Daniel Duncan 7:23 pm 01 Jul 21

Its cos the value of the $ is falling due to inflation. Not because the value of the property has gone up.

    Jesse Mahoney Jesse Mahoney 7:29 pm 01 Jul 21

    Daniel Duncan inflation was at 1.1%. But okay.

    Mitch McClintock Mitch McClintock 7:49 pm 01 Jul 21

    Daniel Duncan haha that makes no sense at all.

Benjamin Challen Benjamin Challen 7:22 pm 01 Jul 21

Awesome keep it going up

Louellyn Violet Louellyn Violet 7:21 pm 01 Jul 21

And the have nots become greater. Sigh, lucky I have great landlords

Matthew Johnson Matthew Johnson 6:53 pm 01 Jul 21

Alice Fisher 🤔 really makes you think

Heidi Tunks Heidi Tunks 6:48 pm 01 Jul 21

Great! (Sarcasm)

Kate Tricks Kate Tricks 6:08 pm 01 Jul 21

Very depressing for us potential buyers 😒

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