The Adelaide housing market is experiencing a surge in demand amid tight supply conditions — a perfect recipe for price growth, according to the latest report from Raine and Horne.
James Trimble, general manager of Raine & Horne, said the "amplified" interest in real estate could be attributed to the border closures.
"With many people staying in South Australia for the summer holidays due to limited access to other states, the state's property markets have continued to clatter along," he said.
Trimble said agents at Raine & Horne have reported strong interest from aspiring buyers, as evidenced by long queues at open for inspections. He said this level of buyer enquiry is "very unusual" for Adelaide.
For instance, a house listed Aldinga Beach, which has a price range of $420,000 to $440,000, has attracted 79 interested buyers in its first open home.
"This level of interest is a significant result for Adelaide real estate and the broader South Australian property market, as these markets usually take a breather over Christmas and January," Trimble said.
A 1960s three-bedroom home in Linden Park also garnered attention from many buyers. Around 200 prospective buyers inspected the home, with 74 making offers. The property was sold for a price that is significantly above the initial asking price, said John Cullen, local director of Raine & Horne Kurralta Park.
"When the property was listed for sale online, it immediately attracted 3,500 hits generated by our Amplify social media campaign. We then had 80 groups through on Saturday, a further 45 through on Sunday, with the balance attending an evening open midweek," he said.
Trimble said while demand for properties in Adelaide remains elevated, the supply continues to shrink. Based on his estimates, property listings in Adelaide declined by 20% in January on an annual basis.
"A lack of supply against a backdrop of robust demand has the potential to drive up values by between 5% and 8% in 2021," Trimble said.
Market figures from SQM Research show similar findings, with property listings in Adelaide declining in January by 0.1% on a monthly basis and 15.9% in annual terms. Over the month, dwelling prices in Adelaide have gone up by 2.8% for houses and 4.6% for units.