Canberra house prices remain stable during April despite restrictions

House prices have remained stable in Canberra during April, despite restrictions on inspections and in-person auctions combined with uncertain economic conditions.

Data from the CoreLogic Home Value Index results released this week shows that while there has been a sharp drop in real estate market activity across the country, Australian housing values did not see a material decline in April.

Canberra house prices recorded a slight rise of 0.1% over the month of April, while Canberra apartment prices saw a reversal in growth, down 0.4% in the same period.

Rent prices weren’t as resilient, and just like almost every other capital city, Canberra’s rental market showed a weakening in April, with rents down 0.7%. This was echoed in other states with falls in Hobart (-1.1%), Sydney (-0.7%) and Melbourne (-0.5%).

Stephen Bunday from LJ Hooker Dickson said he’s been surprised with how well house prices have stayed stable, despite the effects of COVID-19 on the real estate industry.

“I thought there would be a lot of panic selling, which often happens at this sort of time, and the buyers would have no urgency and more to choose from, but it's almost been the other way around,” he said.

“A lot of people have been holding off listing, and I’ve definitely seen a decrease in listings coming onto the market, but the buyers are still there, so that has kept prices stable.”

Jess Smith from McGrath agrees Canberra house prices have remained stable over the past month.

“Everything's fuelled by supply and demand, and at the moment while stock levels of properties for sale are a little bit lower, the buyers who are out there are still competing, and we're still getting multiple offers on properties,” she said.

CoreLogic head of research Tim Lawless said that in the context of rapidly weakening economic conditions and the broader COVID-19 related disruption, the April housing market result looks remarkably resilient.

“The Australian version of this global health and economic crisis is only a month-and-a-half old, and it looks inevitable that there will be some downwards pressure on housing values over the coming months. The magnitude of housing value falls depends on a broad range of factors with

most hinging on the timing and extent of social distancing policies being lifted,” he said.

“The good news is that Australia has managed to flatten the spread of the virus more effectively and efficiently than expected and we are already seeing a subtle easing of social distancing policies in some states. An early return of economic activity should support a lift in consumer spirits which in turn should see housing market activity sparking back to life.”

The NSW Government this week announced that restrictions will be relaxed to allow open inspections and on-site auctions throughout the state from May 9, and Ms Smith said she expects to see more properties come onto the market once restrictions are also eased in the ACT.

“I’ve noticed a lot of people holding off listing their property, and I think it’s not necessarily a fear of COVID-19, but more about convenience. For a family with kids, I think an open home is more convenient for them than having 15 one-on-one inspections during the week,” she said.

“I do think traditionally [vendors] feel an open inspection is going to get them the best result, the more people they can get through, so we’re hoping for some good news about inspections in the ACT soon.”