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Canberra's property market is experiencing a cautious recovery in September 2025, with modest price growth, strengthening auction clearance rates, and a tight rental market driving investor interest across select suburbs.
The nation's capital shows signs of stabilization after a subdued 2024, with dwelling values rising modestly while rental yields remain attractive compared to other major cities. Interest rate cuts and government housing initiatives are supporting gradual market improvement, though supply constraints continue to influence pricing dynamics.
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Canberra's property market shows moderate recovery with house prices up 0.6% annually while units decline 1.4%, supported by improved auction clearance rates reaching 71%.
Rental yields remain competitive at 4.0-6.2% across suburbs, with vacancy rates tight at 1.5%, creating opportunities for both investors and homebuyers seeking stability.
| Market Indicator | Current Status (Sep 2025) | Annual Change |
|---|---|---|
| Median Dwelling Price | $855,663 - $901,271 | -0.7% to +0.6% |
| House Prices | $975,387 | -0.5% to +0.6% |
| Unit Prices | $600,000 | -1.4% to -2.7% |
| Auction Clearance Rate | 71-76% | +16 percentage points |
| Rental Vacancy Rate | 1.5% | -0.3 percentage points |
| Gross Rental Yield | 4.0-4.1% | Stable |
| Days on Market | 49-53 days | -2 to -3 days |
What are property prices in Canberra doing right now compared to last year?
Canberra's property market is showing mixed signals as of September 2025, with house prices demonstrating modest recovery while unit prices continue to face downward pressure.
House prices have experienced a slight improvement, with recent data indicating a 0.6% monthly gain in July 2025, contributing to quarterly growth of 0.8%. However, on an annual basis, house prices remain marginally lower by 0.5%, with the current median sitting at approximately $975,387. This represents a cautious recovery from the more significant declines experienced in late 2024.
Unit prices tell a different story, with values declining by 1.4% annually and some reports showing drops as steep as 2.7% in certain areas. The unit market faces particular challenges due to oversupply, with many new apartments coming to market over the past few years. The median unit price currently sits around $600,000, making it more accessible for first-time buyers but challenging for existing unit owners.
Overall dwelling values have shown modest gains of 0.6% annually, though they remain approximately 5.2% below their May 2022 peak. The market appears to be stabilizing rather than experiencing dramatic swings, reflecting Canberra's typically conservative property cycle patterns.
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How are rental yields performing across different suburbs in Canberra?
Rental yields across Canberra suburbs vary significantly, with some areas delivering attractive returns that exceed 5% for both houses and units.
| Suburb | Property Type | Rental Yield |
|---|---|---|
| Gungahlin | Units | 6.2% |
| Hawker | Units | 5.9-7.1% |
| Greenway | Houses | 5.4% |
| Belconnen | Houses | 4.4-4.8% |
| Charnwood | Houses | 4.7% |
| Curtin | Units | 6.0% |
| Overall ACT | All dwellings | 4.0-4.1% |
The data reveals that unit investments generally outperform house investments for rental yields, with Gungahlin leading at 6.2% for units. This suburb offers a median unit price of $455,000 with weekly rents around $535, making it attractive for yield-focused investors.
House yields are more modest but still competitive, with Greenway delivering the strongest returns at 5.4%. The suburb's location approximately 20 kilometers south of Canberra's CBD provides good value for money while maintaining reasonable rental demand.
What's the current auction clearance rate in Canberra and how does it compare with other capital cities?
Canberra's auction clearance rate has shown remarkable improvement in 2025, reaching 71-76% in recent months compared to just 55% a year ago.
As of late August 2025, Canberra recorded clearance rates between 71% and 76%, representing the highest levels in two years and the strongest year-on-year improvement of any capital city. This surge outperforms the national average of 66.9%, positioning Canberra as a standout market for auction success.
The improvement reflects renewed buyer confidence driven by interest rate cuts and increased competition for limited listings. Recent weekend results show strong bidding activity, with some agents reporting 100% success rates on auction days. The clearance rate improvement of approximately 16 percentage points year-on-year demonstrates the market's recovery momentum.
Compared to other capitals, Canberra now sits above the national benchmark and shows stronger momentum than cities like Brisbane and Adelaide, though it remains below Sydney and Melbourne's peak performance levels.
How many new listings are coming onto the Canberra market each month?
New listing activity in Canberra has increased substantially in 2025, though overall stock levels remain manageable for buyers.
After a slow start to the year, new listings surged dramatically with increases of 60% in February 2025 and 23.6% in May, indicating renewed seller confidence. However, by mid-year, new listings dropped by 9.0% compared to the previous year, suggesting some sellers are holding back waiting for optimal market conditions.
Despite the decline in new listings, total listings have risen by 3.2% annually, indicating properties are staying on the market longer. The ACT has experienced 34 consecutive months of growing total property listings, longer than any other capital city, though current levels remain below previous highs.
The current listing environment provides buyers with reasonable choice while avoiding the oversupply conditions that could depress prices. This balance supports the gradual market recovery being observed across the territory.
What's the average time properties are staying on the market before being sold in Canberra?
Properties in Canberra are selling within a reasonable timeframe, with average days on market showing improvement compared to national trends.
The median time on market for all properties currently sits at approximately 49-53 days, representing a slight improvement from 51 days recorded a year ago. Houses specifically are experiencing varied conditions, with days on market reaching seasonal highs but performing better than historical averages for this time of year.
Unit properties are showing more positive momentum, with days on market trending downward for the second consecutive month as of the latest data. This suggests improving demand in the apartment sector despite broader unit market challenges.
Canberra was one of only two capitals to see median time on market decline over the year, with selling times falling by 3 days. This performance contrasts positively with most other capital cities where properties are taking longer to sell, indicating relative market strength in the nation's capital.
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How have interest rate changes specifically impacted buyer demand in Canberra?
Interest rate cuts implemented by the Reserve Bank of Australia have significantly boosted buyer sentiment and market activity in Canberra throughout 2025.
The RBA's reduction of the cash rate to 4.10% has spurred renewed buyer interest and confidence, particularly benefiting first-home buyers and investors who had been sidelined by high borrowing costs. This easing in monetary policy has directly contributed to increased open home attendance and stronger sales activity observed across the territory.
Market participants report that the rate cuts have improved borrowing capacity and affordability, leading to more competitive bidding at auctions and faster property sales. The cuts have also encouraged upgraders who were previously hesitant to move, creating a flow-on effect throughout different price segments.
Looking forward, market analysts expect continued rate cuts through 2025 will further enhance buyer activity. Some experts predict that even modest additional cuts could trigger stronger demand waves, particularly in the lower end of the market where affordability improvements have the greatest impact.
Which Canberra suburbs are showing the strongest price growth and which are declining?
Canberra's suburb performance shows stark contrasts, with newer developments outperforming established areas while some traditional suburbs experience value declines.
| Strongest Performers | Annual Growth | Weakest Performers | Annual Decline |
|---|---|---|---|
| Denman Prospect (6 months) | +14% | Denman Prospect (houses) | -10.6% |
| Casey (houses) | +12% | Mawson (units) | -11.1% |
| Whitlam | +12.6% | North Canberra | -1.9% |
| Macarthur | +10% | Holder | -5.7% |
| Whitlam (recent) | +9% | Various established suburbs | -2% to -5% |
| Harrison (units) | +7.1% | - | - |
| Molonglo | +5.5% | - | - |
The data reveals a clear pattern favoring newer suburban developments and areas with modern infrastructure. Whitlam has emerged as a standout performer with double-digit growth, benefiting from new school developments and modern housing stock.
Conversely, some established suburbs are experiencing declines as families migrate to newer areas with better amenities and more affordable entry points. The divergent performance reflects changing buyer preferences toward contemporary developments and better infrastructure.
What's the current vacancy rate for rentals in Canberra, and how is it trending?
Canberra's rental vacancy rate remains exceptionally tight at 1.5% as of September 2025, well below the balanced range of 2-3% and indicating strong tenant demand.
The current vacancy rate has improved from 1.8% recorded a year ago, demonstrating continued tightening in the rental market. This rate places Canberra among the lowest vacancy rates nationally, creating a highly competitive environment for tenants and favorable conditions for landlords.
The downward trend in vacancy rates reflects several factors including steady population growth, limited new rental stock in certain areas, and strong employment conditions supporting rental demand. Some reports indicate the rate has ranged between 1.2% and 1.6% throughout 2025, consistently staying in tight territory.
This tight rental market continues to support rental growth and maintains upward pressure on rents, though the pace of rental increases has moderated compared to the peak growth rates seen in previous years. The low vacancy environment particularly benefits investors seeking reliable rental income streams.
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How much new housing supply, such as apartments or townhouses, is expected in Canberra over the next year?
Canberra faces a significant expansion in housing supply, with the ACT Government targeting 30,000 new dwellings by 2030, supported by substantial land releases and construction initiatives.
Government land release programs are expected to support nearly 26,000 homes over the next five years, with significant activity planned for suburbs including Macnamara, Jacka, and ongoing Molonglo development. The 2025-26 budget allocates over $145 million to kickstart this housing pipeline through direct investment and industry incentives.
Specific projects underway include 57 new social housing apartments in Gungahlin due for completion in early 2027, and a major city center development featuring 502 dwellings (including 76 affordable units) scheduled for construction between 2028-2034. The "missing middle" housing reforms will also enable dual-occupancy developments on blocks over 800 square meters.
However, industry analysis warns that construction capacity constraints could limit actual delivery, with completion times already above average and elevated construction costs. The focus is shifting from approvals to ensuring approved homes actually get built, addressing the "full bath" problem where more approvals may not translate to completed homes.
How are Canberra's employment rates and population growth influencing housing demand?
Canberra's employment stability and steady population growth continue to underpin housing demand, with the city benefiting from its role as the national capital and growing technology sector.
The territory's population is increasing at approximately 1.5% annually, adding around 7,000 new residents each year and reaching an estimated 456,816-482,986 people by 2025. This growth rate exceeds the national average and supports ongoing housing demand across all market segments.
Employment conditions remain robust, anchored by stable government sector jobs that comprise 32.3% of local employment, along with growing professional services (9.5%) and healthcare sectors (9.1%). The government employment base provides economic stability that historically supports consistent rental demand and property values.
The combination of population growth above national averages and stable employment conditions creates sustained underlying demand for housing. This demographic foundation supports the market's recovery trajectory and provides confidence for both investors and homebuyers considering long-term commitments in Canberra.
What government incentives or local policies are currently shaping the Canberra property market?
Multiple government initiatives are actively supporting Canberra's property market, ranging from first-home buyer assistance to major planning reforms and supply-side interventions.
1. **First Home Buyer Support:** The federal Home Guarantee Scheme expansion from October 2025 allows purchases with just 5% deposits and no lenders mortgage insurance. ACT-specific stamp duty concessions provide full exemptions for properties up to $470,000 and significant reductions for higher-value purchases.2. **Off-the-Plan Incentives:** Eligible buyers purchasing new apartments, townhouses, or unit-titled properties off-the-plan for $1.02 million or less may receive complete stamp duty exemptions, supporting new development sales.3. **Planning Reforms:** The "missing middle" housing reforms enable dual-occupancy developments on large suburban blocks, potentially increasing density while maintaining suburban character.4. **Construction Industry Support:** Training subsidies for construction trades have increased to 90%, addressing skill shortages that constrain housing supply.5. **Social Housing Investment:** Significant budget allocation for 85 new public housing dwellings and expansion of affordable housing programs through partnerships with community housing providers.These coordinated policy measures address both demand-side affordability and supply-side constraints, creating a supportive framework for market stability and growth.
What do major banks and property analysts forecast for Canberra's property prices over the next 12 months?
Industry forecasts for Canberra present mixed but generally optimistic projections, with most analysts expecting modest to moderate price growth through 2025 and into 2026.
KPMG forecasts 3.5% house price growth for Canberra in 2025, positioning it as a "solid performer" alongside Melbourne. For 2026, expectations increase with some analysts predicting potential growth of 6-12% over the two-year period ending 2026, though this represents cumulative rather than annual growth.
Westpac and NAB both project national dwelling value growth around 3% for 2025, with Canberra likely to follow similar trends due to its unique market dynamics and government employment base. The Bank of Queensland presents more bullish forecasts, tipping Canberra alongside Darwin for 12% cumulative growth over 2025-2026.
Most analysts agree that interest rate cuts, housing supply constraints, and stable government employment will support gradual price appreciation. However, they caution that growth rates will be more measured than the boom periods seen in other capitals, reflecting Canberra's historically conservative market cycles and the ongoing apartment oversupply situation.
Conclusion
This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.
Canberra's property market outlook for September 2025 presents a cautiously optimistic scenario for both investors and homebuyers, characterized by modest recovery, competitive rental yields, and supportive government policies.
The market demonstrates stability rather than volatility, with house prices showing signs of recovery while unit markets face ongoing challenges from oversupply. Interest rate cuts and improved auction clearance rates signal strengthening buyer confidence, while tight rental conditions continue to favor investors seeking yield-focused strategies.
For potential buyers, the current environment offers opportunities in a stabilizing market with government support, though careful suburb selection remains crucial given the divergent performance across different areas. It's something we develop in our Australia property pack.
Sources
- Canberra Property Market - Which Real Estate Agent
- OpenAgent Canberra Property Market Data
- KPMG Property Forecasts 2025
- Property Update Market Predictions
- API Magazine Canberra Markets Analysis
- Allhomes 2025 Property Forecast
- OpenAgent Rental Yields by Suburb
- Allhomes Auction Clearance Rates
- ACT Government Housing Supply Program
- Population Australia - Canberra Growth