Affordable suburbs drive auction market as supply hits record high

Canberra’s auction market is being driven by strong performance in its more affordable suburbs, with new data showing the Tuggeranong region posted the capital’s highest clearance rates in October.

Domain data shows that the Tuggeranong region led the capital with an impressive 77 per cent clearance rate last month, 17.3 percentage points higher than at the same time last year, followed by Belconnen at 67.5 per cent, up 6.7 points.

The strong performance in affordable districts comes as the Australian Government’s Expanded 5% Deposit Scheme takes effect, and total property supply in Canberra reached a record high.

Overall, Domain data shows Canberra recorded a 59.3 per cent auction clearance rate in October, down 2.7 percentage points from September but up 9.2 percentage points year-on-year. The slight monthly dip was likely influenced by the record-high supply, which has provided buyers with increased choice.

Justine Burke of Momentum Property said the trend was clear on the ground.

“Interest for houses in the market up to $1 million has been really strong, particularly for three-bedroom homes or townhouses up to $750,000,” she said.

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Burke anticipates the 5% Deposit Scheme, which began in October, will soon impact the market more broadly.

“Those selling properties up to $1 million are then likely to go on to buy properties in the next price bracket, so I expect we’ll begin to see a flow-on effect towards those higher price points in the market, too,” she said.

In another shift, Burke noted that buyers are returning to “fixer-uppers” after a period of shying away from renovations.

“We have sold quite a few properties recently that have needed a lot of work, which up to 12 months ago would not have been as popular with buyers,” she said. “It seems people are interested in doing the work again and see value in completing renovations the way they like it.”