Housing prices have quadrupled in just two decades, unit prices have tripled, and values could reach an average of over $3.8 million and $1.3 million respectively – These are some of the key insights from Allhomes’ research on Canberra’ property market over the past 20 years.
The report also noted that, since 2000, houses sold at auction have risen from roughly 2 per cent to 25 per cent.
Units on the other hand have remained unpopular at auction, only making up 4 per cent of total sales.
The capital gain for houses over the past two decades equates to a compound annual growth rate of 7.35 per cent.
“Twenty years ago, house prices at the time had hit a record $205,513, fast-forward to another new high mid-2020 at $819,090,” Domain Senior Research Analyst, Dr Nicola Powell explained.
“There have been many possible disrupters to the Canberra property market over the past 20 years, from the dot.com downturn to the Global Financial Crisis, from the devastation of the 2003 bushfires to the Mr Fluffy loose-filled asbestos scheme, from APRA’s recent credit squeeze to the current pandemic,” she continued.
“Despite this, over the past two decades Canberra has been one of the top-performing capital cities. The housing market has seen some significant gains over the past 20 years, with house values moving through four distinct growth cycles.
“House prices have soared 299 per cent from the end of the past century to mid-2020, producing the second strongest growth behind Melbourne’s 322 per cent.
“This has provided home owners with a significant wealth boost, although three-fifths of this growth occurred during the first 10 years of this century.
“Throughout this time there have been very few periods when house prices have fallen annually. Canberra avoids the big price swings that Sydney experiences, proving slow and steady wins the race for those in the market for the long haul.”
Unit prices have increased 190 per cent, but Dr Powell notes that only one-tenth of this growth occurred in the past 10 years.
“Housing prices have risen at a faster pace than household incomes. The average Canberran’s full-time weekly wage has risen 200 per cent over the past 20 years.
“Canberra’s house price-to-income ratio is now tracking at 8.5, compared to 4.2 at the end of 2000. The unit price-to-income ratio, however, is far more favourable in comparison, now at 4.7 compared to 3.2.”
Below are some of the key insights from the Allhomes report.
- Canberra has been one of the top-performing capital cities in Australia.
- House prices have increased almost 4x (299 per cent) since 2000
- In 2000 house prices reached just over $205,00 (at $205,513). Fast forward to mid this year, and the median house price has quadrupled to $819,090.
- Unit values have also increased almost 3x (190 per cent) over the past two decades.
- Canberra’s median price could more than quadruple in the next 20 years
- If the same rate of growth is applied to the next 20 years it could reveal some pretty big multimillion-dollar medians.
- The median Canberra house price could reach over $3.8 million and $1.3 million for houses and units respectively
- These predictions are simple extrapolated medians that don’t take into account the variety of factors that can affect price growth, such as demographic, economic or political changes, or even global pandemics.