The last quarter of the year is normally one with many properties hitting the market and an urgency from buyers to secure and potentially even settle prior to Christmas. We found that the market changed during this quarter, greatly, depending on which section of the market you were in.
The million dollar market cooled slightly with tightening lending conditions continuing. Some purchasers and even owner occupiers decided to play the wait and see game, believing the New Year would have more options hitting the market. Quality investors or first home owner type homes sitting in the market at $450,000 to $600,000 were still in high demand and sold quickly, especially in highly desirable suburbs. Character homes, both with renovations or ready for one in popular suburbs close to good schooling and shopping also stayed desirable with good competition amongst them.
Overall Adelaide continued to perform well in comparison to other capital cities, especially those in the Eastern States. As reported by realestate.com.au the City of Churches’ median property price is now at $437,511, with houses up 1.3% on last year to $465,000.
We found that there was a good mix of buyers in the market including first home buyers, investors and owner-occupiers. Investors based in Adelaide, Melbourne, and Sydney can all see the value in investing here. On offer is smart investment purchases at affordable prices in high demand (or neighbouring) suburbs assuring steady rental returns and future growth.
We also saw a good mix of first home owners, wanting to take advantage of the grants on offer, and investors seeking low maintenance properties at opens for new builds. The quality between the new builds is often evident and those with more generous or more accommodating layouts (eg extra space for study, second living space or courtyard), definitely saw an increase in potential purchasers.
We have also seen a rise in clients looking for properties for their Self Managed Super Funds. While there are stipulations around these purchases, we have secured a number of well-performing properties in growth areas that will serve them well.
Lifestyle suburbs in Adelaide continue to prove popular. The Adelaide Hills alone boasted 3 of the top ten in-demand suburbs recorded nationally by realestate.com. The figures are based on the number of views per listing in the December quarter, with the three Hills suburbs each attracting between 5200 and 5800 views per listing! These lifestyle suburbs, Aldgate, Crafers West and Belair, all offer a community, family-friendly feel in a beautiful setting. And I know I have been known to dream about a move to the “hills” and spend some quality time online searching what is available.
The overall feel of the market is still positive and from all reports, that’s exactly how it should be. Huge news that Adelaide has been chosen to host Australia’s international space agency was also announced. It will be located at the former Royal Adelaide Hospital grounds which are being transformed into Australia’s first creation and innovation neighbourhood, where thousands of people will work and stay.
“Our Government’s $41 million investment into the agency will act as a launching pad to triple Australia’s space economy to $12 billion and create up to 20,000 jobs by 2030.”
With jobs, there not only becomes the need for housing, but an increased positivity for the state creating further spending and therefore a roll on effect of jobs in a number of sectors especially hospitality and retail.
The first quarter of the year generally commences slowly as people come out of the Christmas/New Years/Summer holidays haze. Quality property will continue to hit the market and the savvy investor and purchaser will continue to have competition. As is always the case in Summer, beachside suburbs will continue to receive good interest and achieve good results. It has been reported that almost 150 homes sold for more than $1 million across Adelaide’s West last year. A number of local agents foresee that this will continue and record even bigger sales this year. Lockleys, Tennyson, Henley Beach and Semaphore had the highest number of seven-figure sales, with a varied selection of homes from character to modern, executive living. Who doesn’t love a beachside suburb, especially when it is still only a 20 -30 minute commute to the CBD!
All in all, we expect to see more of the same; always popular, lifestyle suburbs performing, growth areas continuing to gain interest and suburbs that have in the past been overlooked, become the next hot suburb as their neighbouring suburbs become increasingly harder to enter into due to pricing and owner occupiers staying put. Adelaide – the safe and steady investment!
Auction Clearance Rates
Whilst Adelaide’s auction market is reasonably small compared to the larger auction driven markets of Sydney and Melbourne. Our clearance rate is stable and behaving more consistently with previous years, apart from a dip in December.