Canberra home prices have dropped 1.6 per cent in September

Only Sydney, which suffered losses of 1.8 per cent and Brisbane with 1.7 per cent, underwent further property pain.

However property prices overall in Australia have dropped less rapidly in September, which is traditionally one of the biggest months for buying and selling homes.

There was a national loss in value of 1.4 per cent according to CoreLogic's September Home Value Index, which is down from the 1.6 per cent loss that was sustained in August.

According to CoreLogic's research director, Tim Lawless, it is probably too early to suggest the housing market has moved through the worst of the downturn.

"It's possible we have seen the initial shock of a rapid rise in interest rates pass through the market and most borrowers and prospective home buyers have now 'priced in' further rate hikes, " he said.

"However, if interest rates continue to rise as rapidly as they have since May, we could see the rate of decline in housing values accelerate once again."

The Reserve Bank of Australia is set to meet this Tuesday to set the official interest rate, with a rise widely expected.

Canberra, which how has a median home price of $886,990 according to CoreLogic, is now following overall capital city trends of prices coming off after big gains in the last two years.

"Every housing market is moving through a sharp reduction at the moment including Canberra where housing values are down 4.4 per cent since they peaked in June this year," Mr Lawless said.

"It's a little bit later than Sydney and Melbourne but it does look like the market is playing catch up with housing prices down 1.6 per cent in September and losses of 4.4 per cent since June.

"So it does look like the market is moving through a downturn."

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He said the drop in prices came as Canberra still saw a rise in listings in the peak month of September, while some other capitals saw less homes available for sale.

"It's one of the few markets where we are seeing supply level are starting to rise.... And it does look like buyers have started to ease off as well," he said.

"This market isn't immune from the downturn and we are seeing housing trend lower now."

He said it was important to look at the recent losses in relation to the enormous growth that housing prices have gone through across Australia since the beginning of the pandemic in March 2020.

Housing prices in regional Australia have risen by an incredible 42 per cent in that time, while capital city prices overall have risen by 25.5 per cent during the same period.

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