Kevin Rudd's Yarralumla sale highlights Canberra's likely looming challenges
The former Prime Minister Kevin Rudd and wife Therese Rein paid $2.175 million for their home in leafy Yarralumla, Canberra in 2010.
Listed for sale at $2.25 million through the Peter Blackshaw agency in May, it has now been sold at a reported $2 million. There is typically a required 6% discount among private treaty listings to secure a sale in the prestige suburb.
Set behind electric gates, with double lock up car accommodation, the house (pictured below) was described as sophisticated and luxurious.
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The contemporary Mueller Street house was bought after departing The Lodge so as their son, Marcus, could finish his schooling.
The five-bedroom, four bathroom house is set on 936 square metres which traded at $778,000 in 2005.
Yarralumla’s median house price was up by 7% to $1.07 million over the year prior to the listing, according to RP Data, which now puts the median at $778,000.
Perhaps not by the amount suggested, but Canberra’s housing market has slowed due to inpart to uncertainty around public service employment after the September federal election.
Canberra house values were down 0.9% during September, although up 2.7% over the three month period. The Canberra house median sits at $540,500 after a decade when there has typically been 4% annual growth.
Back in 2011 Canberra was within cooee of again matching Sydney’s median house price, according to the RP Data-Rismark index.
The 2011 gap for houses was $12,625, with Sydney’s house median at $561,625 and Canberra’s house median at $549,000. Sydney's median house price is now at $665,000, so the gap is now $116,000.
Much of Canberra's strength came as household incomes in Canberra are among the highest in the nation.
Canberra’s average equivalised disposable weekly household income was put at $1,101 in recent ABS data - about 30% above the national average.
While the clear result in the federal election has provided a greater level of certainty, there were challenges for the Canberra residential market, according to the latest report from CBRE.
The report highlights that the outlook for the market remains tied to the extent of the contraction in public sector spending and tips that buyer confidence will remain flat over the medium term despite the low interest rates currently available.
However CBRE senior research manager Sam Reilly says the "particular pain point" was expected to be the mid-priced sector of the market between $500,000 and $1 million, where middle management in the public sector was generally the most active.
“Middle management has been targeted as a primary area for upcoming job cuts which has meant caution has been evident from buyers in this price range,” Mr Reilly said.
At the top end of the market, for property priced above $1 million, the report highlighted limited turnover with vendors still discounting to attract buyer interest.
