While multi-unit living is a mature market in Sydney, Melbourne and Brisbane, it's an emerging market in the ACT. Canberra is just beginning to experience the demand for units well established in those cities. Each year about 2000 apartments are sold off-plan in the ACT and Geocon alone is forecast to sell 700 in 2017. On average for the past four years, Geocon's sales volumes have increased by 50 per cent, year-on-year.

Canberra is a growing city. Each year, the ACT adds another 5000 to its population, which equates to a need for 70 new dwellings each week just to keep up with population growth.

Limited land release for new houses coupled with the cost of housing means buyers seek alternative solutions to own a home. Apartments offer excellent value and amenity, especially when compared with a tiny dogbox on a pocket-handkerchief block out in the 'burbs, away from employment and amenities. The idyllic Australian dream of the house on the quarter-acre block is dead. That's not the reality of today's new housing estates, and buyers know it. In the ACT, land costs about $1000 a square metre and the cost to build a quality house is about $2800 a square metre. It just doesn't stack up as a value proposition and first-home buyers can't afford a house-and-land package for $800,000. It's no surprise this group accounts for more than half of Geocon's sales.

Rental markets are the ultimate guide of whether there's a supply/demand imbalance. Those trapped in the rental cycle unable to save for a home deposit know all too well that rental vacancies in Canberra are exceptionally low – less than 1 per cent (compared to 2-3 per cent nationally) – and therefore rents are high. The frustrating thing is they'd actually have no trouble paying off a mortgage if they could save the 20 per cent deposit. On a comparable property, it currently costs about the same to rent as it would to service a standard loan for 80 per cent of the property's value.

With rental returns strong, interest rates low, and less value offered in other locations, investors are coming out of the woodwork. The ACT market is counter-cyclical to other parts of Australia. When markets such as Sydney, Brisbane and Melbourne slow, some of that capital gets redirected to Canberra because we outperform those markets in terms of price growth. New investor housing finance in the ACT increased by 35 per cent last year, with the greatest increase in the second half of the year.

As Canberra grows and becomes more sophisticated, people want to live close to everything they need. They want to be close to shopping, dining and entertainment options where they don't need to get in their car, and they want to be close to their work. In Canberra, residential density in the town centres makes absolute sense. It also adds vibrancy and safety because these areas are alive after 5pm, when in the past they were like ghost towns once all the workers went home. We have begun the journey to sustainable urban intensification.

This is no freakish bubble that could burst at any time. It's a solid trend underpinned by buyer demand and APRA regulations, which mean developers need to have sold at least 70 per cent of their units before they can get finance. The settlement risk feared in other states has not manifested in the ACT.

As a local company accounting for more than 30 per cent of the apartment sales in Canberra, Geocon is seeing this borne out in its own developments.

Our recently completed 330-unit Wayfarer development in Belconnen is a case in point. Only about 25 units remain for sale, and 280 settled successfully last month. A number of units have already been resold, on average at 10 per cent above the price the sellers originally paid two years ago.

Geocon's Infinity development in Gungahlin is the best-selling project in the ACT residential apartment marketplace since 2010 (Manhattan in Canberra City). Sales at Southport in Tuggeranong have been strong and will be boosted by the opening of our display suite this weekend. Shortly, we will release to market our new project in Braddon, Midnight, which is already getting strong interest, and Republic in Belconnen will be released later this year. By next month we will have more than 1000 apartments under construction and, by the end of this year, 1500 apartments under construction.

Our confidence in the market is based on sound economics. Rental yields data dispels any suggestion of a market contracting. Interest rates are at record lows and showing little sign of rising judging by the Reserve Bank board's recent decision to keep rates on hold. The booming apartment market is here to stay.

Nick Georgalis is managing director of Canberra property developer Geocon.