With property prices growing moderately, the Adelaide market exhibits stability in the midst of seesawing activity nationwide
The SA economy is still in the process of regaining its footing following the recent downturn of the manufacturing industry. General dwelling values and rental rates continue to fall in Adelaide as employment remains an issue. However, there is confidence that the state will bounce back in the long term.
“There are seeds of hope as more defence projects ramp up and other initiatives like the Northern Adelaide food bowl expansion come online,” says Pat Gerace, CEO of the Urban Development Institute of Australia SA.
“The make-up of residential housing in greater Adelaide continues to evolve. There are a number of popular greenfield development areas such as Mount Barker that offer affordable products that are both attractive and unique.”
Demand levels are not astronomical in this capital city as population growth remains low. However, property values are still increasing at a modest rate. Moreover, density is increasing in the western suburbs as developments are easily approved.
“In the inner-rim council areas, more and more existing residents, particularly retirees, are looking for a place close by that maintains a suburban context but also offers the low-maintenance lifestyle,” Gerace says.
“Younger generations are also looking for an affordable place close to where they grew up, and to take advantage of established schools and suburban amenities.”
At the fringes of the metro, downsizers and retirees will also find affordable housing, as new construction at the edge of the city offers excellent options for buyers on a budget.
Steady as she goes
Charles Tarbey, chairman and owner of Century 21 Australasia, agrees that while SA is not a booming market, it represents short-term stability with potential for long-term growth.
“South Australia has not experienced much change in the market, given all of the frantic positive and negative activity around other parts of the country,” he explains.
“Nonetheless, the state is always driving to create and accept more industry to attract and retain a greater population base. I believe that it has strong stock levels to accommodate any population growth.”
Tarbey believes that, as a whole, SA can be a steady market for long-term investment. Given its present affordability, it’s a good time to capitalise. CoreLogic data shows signs that buyers may be seeing the value of the state’s market, as auction clearance rates have been rising. Among the smaller states, Adelaide was the only capital city to record a higher week-on-week volume of auctions.
SUBURB TO WATCH
REYNELLA: High rental yields on offer
A suburb 20km south of Adelaide, Reynella is seeing some positivity in the house market as values inch upwards.
The median price has clocked in at $308,690, making Reynella houses very affordable for a suburb that’s only about half an hour’s drive from Adelaide. Yields are also high, at an average of 5.3%. Units are less popular, but returns are also favourable, thus investors could be getting a good deal given that Adelaide has a fairly steady market.
Reynella is very accessible, as it is served by bus routes on the Adelaide Metro network. Its connection to South Road and Sheriffs Road is another advantage.
Accessibility: It’s easy to commute to and from Reynella by bus
Amenities: Reynella is home to the Junk Food Junction with its many fast-food outlets
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