Canberra’s house values may be cooling but rental prices remain strong, making it an ideal time to become a property investor in our nation’s capital.
MARQ Licensed Agent Jason Anasson said Canberra presented solid opportunities for investors, with a lack of available rental stock keeping property prices robust and the large number of public sector jobs meaning there was a reliable stream of prospective tenants.
“Now is a good time to invest in Canberra,” Jason said.
“Obviously, there’s been a lot of steam that’s come out of the market and that brings good opportunity for people to get in, because realistically, in my opinion, the best time to buy or invest is when the majority aren’t.”
CoreLogic’s latest Quarterly Rental Review, released in October, showed that Canberra was the most expensive capital city rental market in Australia.
While Canberra recorded a slight dip in house rents, dropping 0.9%, in the three months to September, unit and apartment rental prices surged by 1.0%.
Across both the apartment and house markets, rental prices were up by 7.2% in the past year, with the median weekly rent now $682.
Canberra rental yields were 3.97% in September – slightly above the national yield of 3.57%.
“Canberra’s rental market is definitely one of the strongest in Australia at the moment,” Jason said.
“There is still a general lack of supply when it comes to rentals and I think that’s what’s holding up the price point. Even if the market is cooling off from a sales perspective, the fact is that we are still lacking in supply of rental stock and that’s definitely putting pressure on rents and keeping them up, which is good news for investors.”
Jason said traditionally, January and February could be heated times in the local rental market, with families relocating, starting new jobs and settling children in new schools.
“If someone was looking for the best possible yield they could get, the best time to put it on the market is around January or February.”
Jason suggested buyers looking to become investors in the Canberra market give keen consideration to a property’s proximity to local amenity, retail and public transport.
Purchasers were also making serious decisions based on school catchments, particularly where there were sought-after and high achieving schools in the neighbourhood, he said.
“Obviously, north of Canberra some of those suburbs have grown in popularity and anything that is on the light rail has been extremely popular. As those inner city suburbs have become more unaffordable, people are able to purchase further out and they can still transit into the city with the transport network,” he said.
“Being close to shops and school catchment areas has become ‘a thing’ now, which it wasn’t previously in Canberra. You hear a lot about schools and catchment areas in the bigger cities in Sydney and Melbourne and now that’s playing a big part in the decisions of buyers in Canberra as well.
“A lot of investors are actually selecting homes depending on the catchment area so there is good access to these schools.”