A landmark, joint study by Aussie Home Loans and CoreLogic has revealed Canberra house values have risen at an annualised rate of 6 per cent or $20,800 since 1993.
At the same rate of growth over the next 25 years, Canberra’s median house value could rise from today’s $678,800 to reach $2,924,000 in 2043.
The Aussie/CoreLogic ’25 years of housing trends’ report found the typical Canberra apartment has risen at an annual rate of 4.7 per cent or $11,900 per year over the last 25 years, reaching their current median value of $435,100. In 25 years, the median unit value in Canberra could be $1,383,000.
Chief Executive Officer of Aussie, Mr James Symond, said “Our report reveals that over the last quarter-century, residential property in Canberra has been a strong performer and I expect that it will continue to perform well.”
The percentage of annual household income required to service a loan in Canberra – at an 80 per cent loan to value ratio – has risen from 20.2 per cent to 27.7 per cent since 2001.
Mr Symond said “With average mortgage rates currently close to their record low levels of the 1960’s, loan serviceability levels have actually improved in recent years.
“However, housing affordability remains an issue for some people in Canberra. Buyers now need to dedicate more than 100 per cent of their annual gross household income to raise a 20 per cent deposit, up from 65 per cent in 2001,” he added.
The report expects Canberra to increase its housing density as the population grows and urban planning strategies maximise the use of strategically located land and transport corridors.
The report also revealed the top 20 suburbs in Canberra for value growth over the last 25 years, with Conder the star performer.
Conder has experienced extraordinary growth in its median house value from $48,500 to $581,400 - annualised growth of 10.4 per cent which is well above the ACT average.
Detached houses have been the primary drivers of the market, with the Top 20 listing featuring only two suburbs dominated by apartments; Campbell and O’Connor at number 2 and 16 respectively.
“If the changing face of residential property and staggering growth of technology we have seen over the last 25 years continues, it is likely the next 25 years will produce even greater change,” concluded Mr Symond.
To view the full Aussie/CoreLogic 25 years of housing trends report, visit www.aussie.com.au/25years or contact an Aussie Broker for a free copy.