Demand for homes in Adelaide’s northern and southern suburbs could see property price growth of almost 7 per by 2021, a new market report claims.
According to CoreLogic-Moody’s Analytics Australian Home Value Index Forecast, Adelaide house price values will rise by 0.4 per cent in 2019, 2.7 per cent in 2020 and 3.6 per cent in 2021 – making it one of only three capitals to record growth in 2019.
Moody’s economist Katrina Ell said the predicted price growth would see Adelaide’s current median of 450,000 pushed upwards to $480,150.
Housing values in Adelaide rose 1.9 per cent in 2018 and Moody’s Analytics forecasts housing values will continue to accelerate, she said.
Within Adelaide, the north and south areas will remain the driving housing markets.
“Northern Adelaide is expected to remain robust despite slow gains in recent years because it has the best fundamentals compared with surrounding regions. Nearly 50 per cent of Adelaide’s total population gain in 2016 to 2017 was in Adelaide’s north.
“Moreover, employment gains have also centred in the northern region, with the unemployment rate falling steadily over the past two years.
“Similarly, southern Adelaide has seen similar gains due to a strengthening labour market.”
Real Estate Institute of South Australia president, Brett Roenfeldt said the report spelled good news for all of South Australia, with strong market demand spurred on by billion dollar infrastructure projects across the state.
“What’s predicted is good, steady growth – something SA is renowned for – so we’re sitting in a pretty good position,” he said.
“Prices will only go up from here as our market is driven by supply and demand. Adelaide is currently faced with a lack of stock of quality homes, which is creating greater market competition and driving up prices and I can’t see that change anytime soon.
“Traditionally, it used to be the inner suburbs that have been driving up prices but due to low stock levels and affordability, that has now been pushed out to the northern and southern areas.
The northern suburbs in particular, because of the new expressway, are in strong demand but again, stock levels are low even in those other areas.”
Paul Cameron, who is selling his northeastern family home at 1 Harvard Place, Golden Grove, said he hoped renewed market confidence would help sell his home at a premium price.
The four-bedroom property is listed with LJ Hooker Greenwith/ Golden Grove/ Mawson Lakes and has an asking price of $759,000 to $799,000.
“I definitely think this is the kind of home family buyers are looking for and hopefully we’ll get a good price,” he said.
“It’s a large house, overlooking a creek and there are also lots of sporting clubs and shops nearby.
“I’ve lived here for 25 years and really enjoyed the open space. It doesn’t feel like you’re in the city at all.
Managing director of Ouwens Casserly Real Estate, Alex Ouwens said he attributed Adelaide’s market resilience to its avoidance of unsustainable price increases, as experienced in Melbourne and Sydney over the past five years.
Both markets are currently in a downturn and predicted to see house values fall by up to 10.8 per cent, this year, according to the report.
“Adelaide has been the steady performer even through the closures of significant manufacturing companies in Adelaide’s north. Jobs were lost but they have been taken up through other new industries in defence, space, and renewables… the SA business confidence index is at its highest since pre GFC,” he said.
“With the RBA showing signs of interest rates being further reduced and the Australian Prudential Regulation Authority loosening up the purse strings for banks to offer more loans to customers, it all bodes well for a further period of sustainable capital growth and increased rental yields for property investors looking at SA for a place to live and invest.”