The Australian Bureau of Statistics’ Residential Property Price Index for the March quarter, issued on Tuesday, showed home prices in the territory fell by 0.1 per cent.

The data also indicates Canberra home prices have increased just 1.1 per cent in the past year, which is the lowest growth of all capital cities.

The index includes houses and attached dwellings.

Sydney has continued to drive residential property price increases, with home prices rising by 2.3 per cent in the first quarter. Melbourne followed with growth of 2.1 per cent and Brisbane rose by 0.8 per cent.

Canberra’s fall follows the territory recording the smallest amount of growth during the last two quarters of 2013. Home prices grew by 0.4 per cent in the December quarter and 0.1 per cent in the September quarter.

The index found Canberra house prices showed no change in the March quarter and attached dwellings fell by 0.3 per cent.

In the year to March, house values grew 0.8 per cent and attached dwellings rose by 2.1 per cent.

Nationally, home prices grew by 1.7 per cent in the March quarter, with 10.9 per growth over the past year.

Australian Property Monitors senior economist Dr Andrew Wilson says the data is validation that the Canberra housing market is the underperformer of capital city housing markets in Australia.

He said this was not good as a precursor to what would likely be another hit by way of the federal budget to the underlying drivers of confidence of all housing markets – job security, jobs growth and income growth.

“We’re getting set for the bad news which will impact the housing market that is the weakest in the country,” Dr Wilson said.

He said Canberra had been experiencing a roller-coaster market where falls in house prices were followed by rises in the next month, but this was likely to end.

“I don’t think we’re going to get an up over the June quarter,” Dr Wilson said.

“It’s certainly an uphill battle to find prices growth in a market that’s reeling from more bad economic news.”