SA market on the mend
Election drama may have caused a certain lull in SA’s market, but the capital city has bounced back encouragingly – followed by a number of the state’s regional markets
Elections have a way of stalling life and the events surrounding them. It was no surprise then that SA’s property market slowed over the course of the state’s recent dramatic election campaign.
Following the cliffhanger election – which delivered 23 seats to Labor, 22 to the Liberals and two to the Independents – it took another week for a government to be formed. Although Independent MP Geoff Brock’s eventual decision to support a Labor minority government resolved the situation, uncertainty reigned for a while.
During this period, Real Estate Institute of SA (REISA) president Ted Piteo expressed his concerns about the situation and its potential effect on the market. He also noted that property had not been a particular campaign issue for either party. However, the capital city’s market itself seems to have sailed through the uncertainty and industry concerns with flair.
According to the latest RP Data- Rismark Hedonic Home Value Index results, Adelaide
recorded an increase in home values of 1.4% over March and 1.2% over the quarter ending March 31. This has left the city’s median dwelling price at $390,000.
RP Data figures also reveal that auction clearance rates, which traditionally don’t make up a big proportion of Adelaide sales, have increased noticeably in recent times.
Further, a number of commentators report that confidence in SA’s capital city market is increasing. This is due to a number of factors, including affordability, healthy rental returns and a certain shortage of good property.
It is not just Adelaide’s market that is displaying positive indicators; REISA regional market representatives have also reported that markets in their respective cities are showing signs of growth.
The market in SA’s second largest city, Mount Gambier, has been steadily improving over the last two quarters. Vicki Quinn, from Vicki Quinn Real Estate, says they have noticed an increase in both property enquiries and sales.
“There are positive growth signs around the whole region, and particular areas, like the building industry, have definitely come out of the slump of 18 months ago. And when they pick up it puts a spring in everyone’s step.”
While Mount Gambier tends to be about 12 months behind Adelaide’s market, Quinn says there is now a positive vibe in the local industry. She can see no reason it will change in coming months.
“Over the last few months, we have even started to see first-time investors – as opposed to first home buyers – coming into our market again. They are usually baby boomers, who may have paid off their own homes, attracted by the affordability. ”
In the picturesque rural city of Murray Bridge, the market has started to move again over the last few months. David Clarke, from Professionals Murray Bridge, says they have observed a turnaround which has shown that people are interested in the area, and banks are lending to them.
“We have a good number of listings, and riverfront properties are moving particularly well. Prices are stable and are likely to continue to be so for the next six months or so, with maybe a rise around September.”
Clarke believes that what happens with the market in future will depend a lot on the government. However, improved consumer confidence and the fact that banks are lending again are positive signs for the market.
The local racecourse and motor sport park developments, which are currently underway, will also influence sales in the years to come, he says.
The market in the Eyre Peninsula city of Port Lincoln has suffered through a flat period for a number of years. But, since late 2013, it has started to indicate a marked pick-up.
Steven Prout, from Raine & Horne Port Lincoln, says general interest in Port Lincoln’s property has increased, sales are up, and the days-on-market rate has reduced. While there has been no rise in prices yet, he thinks it will come.
Local market improvement is being driven by low interest rates and a strong year last year for the rural businesses that are the mainstay of the local economy, he says. “We have also noticed that interstate investors are coming back into the marketplace. This is due to a combination of the lifestyle factors we have on offer, and affordability.”
Prout adds that Port Lincoln is likely to have stable growth over the next couple of years but, if some of the mining projects currently under development pan out, the market will benefit significantly.
SUBURB TO WATCH
Bordered by the River Torrens on one side and Henley Beach Road on the other, Underdale has a wealth of features on off er. Just 4km from the Adelaide CBD, it is a western beach fringe suburb.
Underdale is on a coastal plain, midway between the city and the beach. Dean Tripodi, from Professionals Richmond, says, “Internationally, there is a trend whereby people like to live in such areas in order to access both city and beach life. So Underdale ticks that box.”
The suburb’s proximity to the city means it has easy access to a wide range of amenities and services. However, there is a good range of schools, both public and private, in and close to Underdale itself. Nearby Henley Beach has a vibrant coff ee strip, and there are also some local shopping areas.
Alongside the River Torrens, a big linear park, with walking tracks, has recently been developed. This is great for families and lifestyle.
Originally market gardens in the 1950s, the suburb has been developed in several stages. This means there is a good mix of property types, Tripodi says.
“There are big blocks and traditional family homes from the fi fties. Then there are higher-density housing types from the 1970s and 1980s. And then there are a lot of courtyard-style townhouses from the more recent developments in the 2000s.”
Prices remain comparatively aff ordable, and this, combined with Underdale’s convenience, proximity to amenities, and midway location, makes it an increasingly desirable area.