Canberra Coronabuyers shopping up a storm online

The number one question I’m asked right now from clients to journos to the Top Bloke who makes my favourite chai lattes, is:

What’s happening with the Canberra market right now? Are prices falling by 10-30% yet?

Well that’s an easy NO, but what’s been really interesting to see is that there’s big money changing hands amidst all of these ‘uncertain times’ of late.

CV-19 strikes me as being very different to earlier major events. Its cause isn’t borne out of economic circumstances like we saw with the GFC or the stock-sliding dot com bust. We’ve had such a strong and sustained period of growth that it’s hard to remember what tough times were like. The ‘recession we had to have’ is a distant memory now, yet words like depression are being bandied around already. Perhaps this era of clickbait and hyped up media has something to do with that. Whether these early green shoots of recovery are a signal that we’ve turned a corner, with NSW resuming open homes and auctions last weekend (ACT are yet to make an announcement) it’s very much early days right now.

Yet many buyers are seemingly putting the pedal to the metal, with at least six suburb records being set since Corona made its presence known in Australia. Why is Canberra such a strong performer right now, across a range of suburbs? Interest rates dropping to unseen lows has meant a little extra in the kitty for many hopeful buyers, coupled with the cost-saving measures of no lunches out or multiple coffee runs as you’d normally see around town. Increased capacity, coupled with pent-up demand from an already hungry buyer pool after the smoke, hail and even snow, who are now squished up at home and keen to upsize has made 2020 the year of short supply for freestanding homes in Canberra.

Vendors who quickly shelved their auctions in mid-March have largely sold by now and those who tapped out are still waiting patiently on the sidelines. And there’s nothing wrong with that, if they don’t have to sell right now, if they don’t have to have troops of buyers through their homes who may/may not carry an incurable disease, that’s completely understandable from their position. The other reason is that once they sell, there’s very little around for them to choose from, making the whole, “Do I buy first, or sell first?” argument an interesting one. This imbalance of supply and demand has been keeping prices high.

And in some cases, the highest prices we’ve ever seen for that suburb.

As COVID-19 emerged locally and toilet paper became the first thing to disappear from supermarket shelves in early March, up in Canberra’s North, Fraser nearly cracked the psychological $1m barrier with a new suburb high of $978,000 for 1 Bingley Cr.

A big block, however being a corner block much of that land wasn’t really useable, making the true backyard a pretty standard size after all.

Views, renovated and a good Northerly aspect meant this one was going to see a big result. I think we’ll see further price rises in Fraser as there’s some premium blocks backing reserve with greater elevation and strong potential for $1m+ price points in Fraser.

As auctions were shelved, agents were quick to bring planned auctions forward for those vendors were were committed to seeing the process through. Narrabundah’s top price was set on March 23rd, at a neat $3m for 7 Throsby Cr. Narrabundah’s often painted as the black sheep of the Inner South, but this property was more Griffith-like than Narrabundah, really.

Suburb winner at $3m, Throsby Cr…

Nipping at its heels was the sale of 13 Finniss Cr which sold after being passed in just last night, and it came oh-so-close but seemed destined to be the bridesmaid, earning the $20 beauty prize for the suburb (forgive the Monopoly reference - so many board games in lockdown! If I start talking about Mayfair or the relative value of Vine St and the orange set, just slap me). Backing parklands and playgrounds in elevated Red Hill-Narrabundah, this home was a modern show-stopper.

…and the ultra-modern home on leafy Finniss Cr

Quickly after Throsby Cr was some hot action back up in Belco, with Page taking centre stage. I’ve long been a fan of this inner-Belconnen suburb for value for money but it too came close but no cigar to the magic mill. 13 Luehmann St sold for a new suburb record price of $947,500 in late March, after an overhaul to the property that made me look twice to check the address was indeed in Page. At the height of the fear and uncertainty, this property still broke the suburb record. Quite a bit of Page is zoned for higher-density suburban homes, and this property on a standard sized, lower zoned resi block really made the most of what it had to offer. We often talk about ‘highest and best use’ of the land and this is a good example of just that; there’s not much more you could do here to add value to the property.

13 Luehmann St in the Inner-Belconnen suburb of Page

Not to be outshone by its Northern counterparts, Tuggeranong has too seen records broken. Easter was a busy one and that continued into April, with a sale in mid-April down in Bonython for a record price of $1,023,000. If you’ve done the Bicentennial Trail around Canberra then you’ve probably passed this one at 66 Don Dunstan Drive, on quite a small parcel of land close to the nearby pond. Proof that Inner-Tuggers is up there too (the North-South rivalry continues!) with this suburb record set on April 16.

Views for days in ‘New’ Bonython for $1.023m

Another FAQ right now is how many properties are being bought off-market. Now I’ve clarified my thoughts earlier on pre- versus true off-markets in a Facebook post last November, but there are many off-markets being transacted right now. The suburb record for Fisher now belongs to 8 Cobar Pl after an off-market sale in late April saw it quietly change hands for $1,230,000.

8 Cobar Place - sold without being advertised publicly.

Across Namatjira Dr, the suburb in Stirling was long overdue to be broken and a sale in late April for 2 Salvado Pl did just that. With buyers adjusting to the pixelated and disjointed online auctions, this partially-renovated home exceeded expectations to sell for $1,215,500.

2 Salvado Pl in Stirling, ‘in the heart of Weston Creek’ (and yes, I really did just quote that Cooleman Court TV ad).

This is a great example of how keen buyers are to secure a sale in the current climate of limited supply. When buyers are feeling secure in their jobs and demand has been pent up to begin with, it’s a pressure cooker environment. Not every home, and not every suburb of course, but it’s clearly impacting suburb prices across Canberra from top to bottom.

My advice remains unchanged; if it’s not right, sit tight.

Will we see more supply soon, and a potential loosening of this tightly-wound supply and demand balance? Well now that’s an excellent question… and one I’m working through with my clients right now.

Happy house-hunting,

Claire