The month in review: Canberra
By Herron Todd White
The current population of the ACT is circa 380,000 with a projected growth rate of less than 2%. Near record low interest rates and low unemployment levels continue to be the main drivers in the ACT economy.
The median price as at July 2015 for medium density housing has decreased slightly to $410,000. The volume of sales has remained relatively steady with a total of 1,810 sales for the most recent quarter on the back of low interest rates and increased demand due to the Mr Fluffy Buyback scheme.
The Canberra medium density market comprises a mix of established and new developments and includes townhouse style and unit style accommodation. There are a significant number of unit developments currently under construction or nearing completion in the Canberra precincts of Belconnen, Central Canberra, Gungahlin and Woden. Trends in the new developments include using high quality inclusions and in some cases smaller floor plates. Price points follow general property trends with more affordable medium density property available in the outer suburbs, while prices increase in the more central locations. Features like views, standard of inclusions, accommodation and floor level within high rise complexes impact on value. The entry level price point for a modern 1-bedroom unit in the Gungahlin area is around $260,000, while high value, centrally located penthouse style units can achieve $2 million plus price levels.
The average number of multi unit sales in Canberra equates to 3,000 to 3,500 on average per annum. Of this amount approximately 50% are new units. Accordingly, some 1,750 new multi unit dwellings are required to meet annual demand in this sector of the market.
The Flemington Road corridor in both Franklin and Harrison could see the addition of a large number of residential apartments in 2015. Depending on pre-commitment sales some developments may be delayed until demand strengthens.