South Australia soldiers on, despite migration outflow and economic instability, and continues to record steady market activity
Adelaide is getting sidelined by many investors, but the property market continues to perform steadily.
“The Adelaide property market’s resilience has come to the fore. Despite noted headwinds, such as slow population growth and jobs uncertainty, Adelaide’s capital city dwelling values increased 2.4% in the year to June 2017, according to CoreLogic data,” reports Gregg Harris, general manager of NAB Retail.
“It was one of only three capital cities to see an increase in stock levels over the 12 months ending in July.”
The average time on market has lengthened for vendors, but from Harris’s perspective this could be good for buyers, as they can take more time to find the right homes.
Moreover, the rental market looks to be getting stronger for investors.
“It appears that market demand is pushing the rental price higher, which is good for investors,” Harris says. “If you’re thinking of adding an investment property to your portfolio, now is the time to speak to your local banker about finance. With the cost of mortgages decreasing and rent on the rise, that means more money in your back pocket.”
Job creation troubles
While the number of auctions in the city is going down, property values are going up. Quality properties are seeing high demand due to of limited supply, and auction bidding is increasingly the sale method of choice because of the transparency of the process.
“Many astute vendors and their agents are seeing that, with less on the market, the benefit of the auction process is increasing,” says Real Estate Institute of SA president Greg Troughton.
“The REISA is hopeful that auction will continue strongly as the optimum selling process, especially given the lack of stock available in the Adelaide marketplace.”
Nonetheless, while Adelaide remains challenged on the economic front, the market isn’t expected to become a strong performer any time soon.
“The submarine [project] is back on track, but it’s still a few years before [it’s] on the way properly. So now there’s going to be a gap in terms of work in the defence sector,” comments Angie Zigomanis, senior manager of residential property at BIS Oxford Economics.
He also points to the loss of the car manufacturing industry as a blow to employment prospects. “At the end of the day, people need to have jobs and be confident in their jobs. Until the economic and employment environment stabilises and becomes more positive, I don’t think we’re going to see huge growth coming through in Adelaide.”
SUBURB TO WATCH
BLACKWOOD: Hills suburb unruffled by the economy
Sitting in the foothills of Adelaide, the suburb of Blackwood is experiencing steady growth, even with the city’s weakening economy. Blackwood is home to many cafes and restaurants serving various cuisines. Residents have easy access to amenities like schools, public transport and parks.
Blackwood Primary, Blackwood High School and Eden Hills Primary are located in neighbouring Eden Hills, along with Watiparinga Reserve and Wittunga Botanic Garden. In nearby Bellevue Heights there are nursing homes as well as a community park, the Manson Oval.
Trains to Adelaide and Belair run through Blackwood railway station. Buses to the CBD and outer-southern suburbs also stop at this station.
Transport: Residents can travel to Adelaide and other areas of SA by train and bus
Location: There are schools and recreational facilities in neigbouring suburbs