Canberra has overtaken Adelaide as Australia's most liveable city.

An annual survey by the Property Council of Australia asked 5,400 people across 10 cities to rate their city on the issues that matter to them.

Canberra edged out Adelaide and Hobart, scoring highly in outdoor recreation, education, and safety.

The capital also ranked second for healthcare services, cleanliness, design, roads, employment and economic opportunities.

It is the first time the capital has achieved the top ranking after being runner-up to Adelaide for the past two years.

"This is the people's verdict on their own city, a report card for governments on how residents believe their cities are performing in terms of liveability," said Catherine Carter from the Property Council ACT.

But there is still room for improvement.

"Those surveyed believe the ACT Government needs to do more to make housing affordable, supply infrastructure to keep up with demand and set a fair level of taxation when people buy or sell properties," Ms Carter said.

"To boost our liveability ranking in future years, the ACT Government must think more creatively about how to increase the supply of homes, including those available for affordable rent.

"A city can't be liveable if it's not affordable."

Chief Minister Katy Gallagher also acknowledged the cost of housing is a problem.

"I think we are genuinely doing everything we can be doing, of course the next couple of years I think we'll see an easing of housing affordability in Canberra as well, with some of the Federal Government's intentions when they become clear," she said.

Melbourne improved its ranking with big increases in ratings for the road network, attractive city design, and having a diverse range of people who get along well.

Sydney also moved up the table, although it still performs poorly on affordability and traffic congestion.

Darwin is still the ranked the lowest in the survey, mainly due to affordability issues, education, healthcare and safety.

Despite the low ranking, Darwin scored highly for employment and economic opportunities.

Perth also saw a fall in its score mostly due to low economic rankings arising from a slow-down in the state's mining sector.