ACT News

Canberra house prices increase by nearly two per cent in 2014

House prices increased by 1.7 per cent in Canberra during 2014 despite marginal growth during the December quarter, according to new statistics from the Australia Bureau of Statistics.

The residential property price index climbed by 0.2 per cent in the ACT during the December quarter - the second lowest result in Australia behind Perth and Adelaide with 0.3 and 0.8 per cent growth respectively.

House prices increased by 1.7 per cent in Canberra during 2014.
House prices increased by 1.7 per cent in Canberra during 2014. 

The marginal increase came after prices remained steady in Canberra during the September quarter and increased by one percent and 0.5 per cent in preceding quarters

According to the data, the ACT has the third highest mean price for houses at $570,600 behind Western Australia with $596,900 and NSW with $702,500.  

Sydney recorded the largest increase in house prices during the December quarter with a 3.8 per cent climb, which resulted in a 12.2 per cent increase in prices annually.

"For established houses, the rise in Sydney was broad based, with almost all segments of the market showing price rises," read the report.


Darwin was the only capital city to record a drop in prices by 0.6 per cent, which came after a 0.3 per cent decline in the June quarter. However it had an annual increase of 0.8 per cent.

Nationally, dwelling prices increased by 1.9 per cent on the previous quarter resulting in an annual increase of 6.8 per cent.

But a report released by RP Data earlier this week found the result found inflation adjusted home values showed little growth outside Sydney and Melbourne.

"When you take into account the rate of inflation over the same period, the rate of value growth has been more moderate at just 6.1 per cent due to annual inflation of 1.7 per cent," read the report.

"Although overall combined capital city home value growth has been strong over the past few years it has been heavily influenced by Sydney and Melbourne.

"The reality is that outside of the two largest cities there has been very little real home value growth for more than six years."

Housing Industry Association senior economist Shane Garrett said the figures indicated dwelling price growth was now increasing at a sustainable rate.

"In inflation-adjusted terms, the rate of home price growth is now around 5 per cent annually," he said.

"This is exactly the kind of home price growth that prevails over the long term. Australian home price growth is now striking the right balance."

But the increase in house prices did not bring relief to Canberra's rental market, with asking rent for houses remaining steady during the December quarter and increasing by 2.6 per cent for units.  

Domain Group senior economist Dr Andrew Wilson said their latest report revealed rent in almost all capital cities had remain at or near record levels during the December quarter.

"Despite record level investor activity and increased dwelling construction, demand for rental properties continues to outstrip supply, resulting in tight vacancy rates and high asking rents in most capital cities," he said.

"Canberra house rents were steady at $450 per week over the quarter with rents increasing from $380 to $390 a week.

"Both house and unit rents however remain well below previous peak levels with house rents down 2.2 per cent over 2014 and unit rents falling by 4.9 per cent."

J.P Morgan economist Tom Kennedy said the data was good news for Australian property owners despite varying results in capital cities.

"There has also been a notable cooling in house price appreciation in Perth, Australia's most resources-orientated capital city, with annual price growth decelerating from 10 per cent to 1.2 per cent over the past eighteen months," he said.