Adelaide real estate grew by almost 14% over the last financial year, with growth in some parts of the city and across South Australia growing by far more than this number, according to a leading local real estate expert.
“Looking ahead across the current financial year, we anticipate that record low-interest rates will keep demand for South Australian property ticking over,” said James Trimble, General Manager, Raine & Horne.
“Given the fantastic position this state has put itself in because of its rapid response to COVID and ongoing management including over 500,000 South Australians have started the vaccination journey[i], the massive investment in infrastructure and our real estate affordability, Adelaide and surrounding areas still represents fantastic value for money.
“This combination of winning factors will ensure Adelaide and surrounding regions will continue to be sought-after housing markets in Australia over the next financial year.”
Inner south property values will continue to outperform
Con Pappas, Co-Principal of Raine & Horne Unley, said property markets in Adelaide’s inner south such as Unley, Unley Park, Malvern, Hyde Park, and Parkside are very tight. This factor contributed significantly to higher prices over the last 12 months.
“In our little neck of the woods, volumes are very tight, and as such, we have enjoyed a fabulous 12 months with values closer to 20% higher last financial year,” Mr Papas said.
“We are still generating appraisals, but now we have gone into a hard lockdown, this might discourage some vendors, while on the flip side low-interest rates are fuelling strong demand.”
Mr Pappas continued, “The upshot is that we have to live with some uncertainty and that markets will be short on listings for 6-12 months, and if interest rates don’t change as most expect, there’s no reason why we can’t replicate the housing price growth achieved in the 2020/21 financial year over the next 12 months.”
Some properties selling $100,000 above the asking price on the Fleurieu Peninsula
On the Fleurieu Peninsula, 45 minutes south of Adelaide, David Gray, Principal of Raine & Horne McLaren Vale/Willunga, said he expects the market to continue in the same vein as the last 12 months.
“I really can’t see any reason why vendors won’t enjoy decent returns when they sell over the course of the 2021/22 tax year, especially if they’re investors,” Mr Gray said.
“There’s plenty of demand, but the supply of properties on the Fleurieu Peninsula for sale is meagre.”
Mr Gray believes that the 500,000 Australian ex-pats that have returned to Australia in the wake of COVID are driving demand. “These people have to live somewhere and are finding their way to Adelaide and the peninsula,” he said.
“There’s also plenty of people who have moved to South Australia from interstate because they think there will be fewer COVID restrictions.”
According to Mr Gray, higher prices over the next 12 months will be the outcome of demand for property on the Fleurieu Peninsula, outstripping supply.
“We are selling properties in this region where the sales price is outstripping the asking price by a hundred thousand and more in some cases over the asking price,” he said.
“Given these results, investors and empty-nesters seeking to downsize will do extremely well in the Fleurieu Peninsula market over the next 12 months.”