Canberra property market sees unusual spring selling season as buyers and sellers adjust to new conditions

Following 2021's property boom, experts say this year has been an unusual selling season.

Metrics such as vendor discounting, time on market and listing volumes show buyers are firmly in the driver's seat right now.

For the three months to September, Canberra sellers were slashing the sale price of their homes by a median discount of 3.6 per cent, CoreLogic data shows.

Discounting has deepened since the same period last year when the median price drop was 2.1 per cent.

Vendor discounting is measured by the reduction in price from the initial property listing versus the contract value.

Canberra homes are also taking longer to sell this spring, compared to last year.

The median days on market for Canberra properties in the three months to September was 41, a week longer than this time last year (34 days).

Eliza Owen, head of research, Australia at CoreLogic, explained why this spring has seen longer sales campaigns.

"This is because buyers face less competition and may have a lower deposit hurdle on some properties, as well as having the luxury of more time for better decision making, conducting due diligence on properties and having more time to get their finances sorted," she said.

Buyers are still likely to face struggles such as limited borrowing capacity due to higher interest rates and bigger mortgage repayments, she said.

"Conversely, sellers will find it may take longer for them to sell a property, and they may have to come down a little on price expectations to make a sale happen," Ms Owen said.

Listing volumes in the ACT have seen an uplift this spring, with 9.4 per cent more new listings in the month of September compared to last year when the ACT was in lockdown.

But it's still not the typical spring boost in listings the market has come to expect, CoreLogic economist Kaytlin Ezzy said.

"This spring has been really interesting compared to previous years," she said.

"For Canberra specifically, new listings levels are about 10 per cent below the previous five-year average for this time of year.

"But at the same time, we're seeing total listings trend upwards thanks to a slowdown in sales activity."

In September, there were 43.3 per cent more total listings in Canberra compared to the same time last year.

Despite these metrics, sales activity is generally strong, Ms Ezzy said.

"Another thing to note is that while sales volumes across Canberra are lower compared to say this time last year, over the quarter they're still up about 5 per cent compared to the typical volume seen around this time of year," she said.

"So we're still seeing strong sales volumes, but they are lower compared to what we got used to over that COVID boom."

Canberra's auction clearance rate remains strong, too.

Throughout October, Canberra's clearance rate has stayed above 60 per cent and has consistently been one of the highest across the capitals.

Lynn West is one Canberra home owner who recently had success on auction day.

She sold her Duffy home with Luton Tuggeranong in September in order to downsize to a townhouse.

The time of year wasn't a major factor in her decision to sell, however the softer market conditions were a consideration, Ms West said.

"I thought 'I've got to grab what I can', to be honest," she said.

"Because [the market] can go down very, very quickly and you can't be greedy."

Ms West was prepared for her home to take some time to sell.

"I was thinking that it could drag on but it [sold] at auction," she said.

"It was all over in a blink of an eye, really."

Luton Tuggeranong director Michael Martin said many sellers have adapted to the new market conditions.

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"When we're sitting with them at the dining table, even they're letting us know, 'Look, we've seen the market reposition itself, we see that it's not the same as it used to be'," he said.

"And a lot of the sellers we're dealing with now have a genuine motivation behind their sale."

Mr Martin is anticipating stock levels will increase in summer and into the new year.

"Essentially we're going back to pre-COVID conditions where things weren't crazy, homes did stay on the market for longer than a week," he said.

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