Canberra’s housing market has recorded one of the country’s largest jumps in value over the past three months.
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Home values in the capital increased by 2.3 per cent over the quarter, according to RP Data-Rismark’s home value index issued on Friday.
It was the second largest increase of the capital cities behind Hobart, which recorded a surge of 4.2 per cent in value.
House values in Canberra increased by 2.3 per cent over the past three months, while apartment values jumped by 2.7 per cent. These increases were some of the highest of the capital cities, two of which recorded drops in value over the quarter.
Nationally, the eight-capital-city aggregate recorded an increase of 1.2 per cent in home values over the quarter, while house prices rose by 1.3 per cent.
CommSec economist Savanth Sebastian said the gains indicated an increasing turnaround for housing activity across the country.
“House prices have lifted for two consecutive months, while new home sales have surged by 17 per cent in the four months to January – the strongest four month lift in home sales in almost four years,” he said.
“The lift in home prices coupled with a pickup in new home sales certainly supports CommSec’s view that the modest turnaround in housing activity is gaining traction.”
RP Data’s Tim Lawless said most housing markets bottomed out around May last year, and the combined capital cities index had recorded a 3.3 per cent boost in values since that time.
“While the housing market is staging a demonstrable recovery, we need to see values rise a further 4.3 per cent before we can say that a technical recovery has been achieved,” he said.
“That amount of value appreciation is likely to be at least six months away.”
Mr Lawless said the recent results were likely to prompt the Reserve Bank to keep interest rates on hold when the board next met.
Looking ahead, ANZ researchers said market indicators pointed towards continued support for home prices, but not enough for substantial boosts in value.
“We are not expecting strong gains in house prices in this cycle,” they said.
“Ongoing household caution and reduced debt appetite will limit housing demand, while we expect soft employment growth and job security concerns will continue to weigh on sales and prices.”
The home value index issued by RP Data-Rismark recorded the median price of a home in Canberra as $500,000, the third most expensive in the country behind Sydney and Darwin, based on settled sales over the quarter.
The median sale house price for the capital was $545,000, while the median cost of a unit was $405,000, the third and fifth highest rate among the capital cities respectively.
