The Canberra property market is frequently avoided by investors, but it is an “investment-winner” right now, according to a leading residential and commercial property firm.
For investors looking for a long-term solid investment area, Canberra is a definite hotspot, said Colliers International state chief executive, Paul Powderly.
“The ACT has consistently proven itself to be a long-term investment winner,” Mr Powderly said.
“While short-term capital growth might occasionally be stronger in other parts of the country, you cannot beat Canberra for a solid, long-term investment.
"As most investors are looking for opportunities that provide them a steady income over 10 to 20 years, then they should be looking at the ACT.”
Two bedroom apartments are particularly lucrative; recent Real Estate Institute of Australia figures showed that Canberra has the highest annual yield nationwide for properties in this category.
Recent stamp duty changes from the ACT Government have also made property more attractive, with a decrease of $2,540 of that usually payable on a $500,000 property.
Australian Property Monitors' senior economist, Andrew Wilson, recently told Smart Property Investment that Canberra is a fairly solid choice.
However, he said, investors must ensure they understand that it is driven by the public sector and changes in this industry, through economics and politics, can affect property values and growth.
“If you can secure something in Canberra, the prospects of pretty solid growth are always there, notwithstanding what happens in terms of the broader economy and the political cycle, but these things tend to wash through the system in time,” Dr Wilson said.
“With the supply issues that Canberra has, it does mean that the medium term prospects of growth are always relatively positive in Canberra but you do compete with a number of buyer profiles for entry into that market.”
Recently, CBRE Global Research's Residential MarketView said that increased pressure may be a reality, with job cuts looming in the public service sector.
“Any further cuts to public servant numbers are set to feed through to a residential market under increasing levels of pressure,” CBRE associate director Sam Reilly said.
“Employment security has long been a mainstay of the ACT, with property prices experiencing stability and growth in recent times due to the comparative advantage that job security provides."