Hi Andynyc - definitely love Canberra too. I moved from Sydney a few years ago and now spend my time between the two cities. I would move back to Sydney permanently - but my partner and I love it here.
Regarding Canberra as an investment destination - i think i may be a little more skeptical. Personally, i think what i've heard from most people involved in the market is biased BS - so be careful who you speak to. 'Bottom of the cycle' they'll tell you - the real estate agents, the brokers, everyone with a vested interest. 'Now's the time to buy' is what you'll hear. 'Great deals', etc etc.
Regarding the macro pundits - the main view is that it will basically say itll be flat for an extended period of time.
I've spent ardous amounts of time talking to Canberra long timers - they say
its part of the cycle and they say this when the last Government came in. They always point to the 'demand' side of the equation.
If i were a buyer, I'd forget about the demand side altogether (we're probably at the bottom when you only consider demand, employment should improve over the years) - the risk is all on the
supply side.
Canberra is oversupplied now (just ask someone about how much they had to drop their rent by).
However, it will be
drastically oversupplied within 24 months. It may be difficult to get an appreciation of this, but i'd spend some time driving around key localities (City/Braddon, Inner South, Woden, Belco, Gungahlin and Tuggers). You'll see buildings going up everywhere - its nuts. Then go out for a drive in the new areas, its also crazy (the typical First Home Owners Market).
FYI - i'd spend time reading BISShrapnels granular work. They use simple building approval numbers to get the 'supply side' of the story in every state, including Canberra - and compare it to demand. The numbers arent pretty. An oversupply issue that grows year on year for the next 3 years. This will all need to be 'soaked up', and economics101 tells you that prices will adjust to reflect this. There'll be friction in any adjustment, ppl in Cbr arent very leveraged and can hold onto their stock.
The effect on yields has been significant so far (the forums have some insight on this) - but this is before most of the new stock has come online. In 24 months, most of it will be there.
Narrow in on areas where supply isn't outgrowing demand - but consider the correlation between areas. For example, Turner may not be oversupplied, but its right next to Braddon - so the effect will translate over to the other side of Northbourne.
Personally, i'd sit pretty and enjoy being a renter. Wait until the supply comes online and then use your best bargaining tool - competition. I've watched prices fall 20-30k in my building over the last 6 months. Theres still next to no one attending the open homes. There's about another 10 developments that will come online within walking distance.
Good luck! P.s. if your talking to Jamie, you're in good hands!
Cheers,
Redom