Canberra housing market a low-risk investment option

“This will be driven by ongoing population growth due to the strength of the local labour market and its growing status as a city of choice for a growing number of Australians,” said RiskWise Property Research CEO Doron Peleg.

“Canberra is a rapidly expanding city with a stable property market that offers relatively affordable housing (in house-to-income terms). In addition, ongoing infrastructure projects, such as the Canberra Light Rail Network, will bring significant benefits to the area.”

While the housing market is presenting favourable outcomes, units, particularly those off-the-plan, should be considered less favourably, Mr Peleg said, with growth of 5 per cent over the last year and 4 per cent over the last five years.

The next two years will see 5,290 units added to the current stock, or a rise of 8.1 per cent. Typically, this would be considered high risk for units in the short to medium term, according to RiskWise, but because of a high demand for units, this impact will be reduced.

Regardless of the growth prospects favouring houses, median rental returns offer a better result than Sydney for both houses and units, at 4.2 per cent and 5.1 per cent respectively.

The major factors supporting Canberra’s growth, according to Mr Peleg, are both employment and population growth; unemployment across the Australian Capital Territory is at a low of 3.9, which is linked directly to the federal government being the main employer, while population growth is at 1.7 per cent, the second highest nationwide.