Canberra home values have dropped for the fourth month in a row.
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The territory’s houses are now declining at the same rate as those in Melbourne, which had, alongside Sydney, led the downward trend now spreading across the country.
In the ACT, home values dropped 1.2 per cent in August, according to Cotality’s latest Home Value Index.
That amounts to a 3.7 per cent drop over the past year.
Cotality head of research Gerard Burg says downward pressures on the housing market have been compounding since late last year. Picture supplied, by Elesa Kurtz.
The median house in the ACT is now worth just over $1 million, while apartments have dropped to a median $585,937.
The average house in the ACT only tipped over the $1 million mark in mid-2025, after hovering just below it for about two years.
Cotality head of research Gerard Burg said the result “wasn’t awfully surprising”.
A number of pressures had been building since late last year, Mr Burg said, which were making it more difficult to buy a home.
“Initially it was about affordability, then it was the rate rises, the cost of living coming out of the Iran conflict and higher energy prices, and then the changes in the budget,” Mr Burg said.
“Everything has built up over time. We may not have even felt the full impact of some of these things.”
Cash rate rise could delay rebound
House prices were unlikely to make their way back upwards before the interest rate is brought back down, Mr Burg said.
NAB is now forecasting an increase to the cash rate to 4.6 per cent in the September meeting, the highest it would have been since 2011.
Both the Commonwealth Bank of Australia and ANZ believe the Reserve Bank will hold off, but only until November.
Westpac is alone in still predicting the cash rate will remain on hold for the rest of the year, although it concedes the chances of another rise are now higher.
“We’ve been looking at the midpoint of next year as being a realistic point at which rates could start to come down,” he said.
Where prices are dropping the most
Home values in the most expensive suburbs were the first to drop, Mr Burg said.
The steepest decline in the ACT was in South Canberra, where houses dropped 3.3 per cent in August.
The median house value in the district, which includes the affluent suburbs of Forrest and Yarralumla, is now $1.57 million.
In North Canberra, including Turner and Reid, house values dropped 2.1 per cent in August, down to a median of $1.29 million.
Where prices are still on the rise
Only one area, Weston Creek, recorded any growth in values in August, and only in the apartment market.
It was one of just 7 per cent of capital city suburbs that did not go backwards.
Apartments went up just 0.9 per cent in Weston Creek, while houses dropped 1.2 per cent over August.
“The national trend that we are seeing is that this broadening out in terms of the number of suburbs that are in decline,” Mr Burg said.
“What started in the upper end has come across the broader market as a whole.”
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