SA Residential Property Market In Focus

Adelaide has been Australia's strongest property market during 2008, with property values growing consistently across all regions. Residential property values in suburbs through Eastern Adelaide particularly have grown strongly, with house price growth around 30 per cent, and unit price growth in excess of 30 per cent. (RP Data, Thursday 31st March, 2008).

The South Australian property market has shown its resilience to harsh economic pressures by also recording steady growth in the June quarter, the Real Estate Institute of South Australia (REISA) said.

In releasing the REISA/Adelaide Bank Market Update report for the June quarter, REISA President Robin Turner said house prices, auction clearance rates, rental rates and investment returns all recorded moderate growth.

"The official interest rate rises at the beginning of the year coupled with high petrol and grocery prices have had an impact on the real estate market," Mr Turner said. "However this impact has not been as major as many would have expected as there has been no backwards movement, just slower growth which actually reflects a more normal market."

The median house price in Adelaide has remained unchanged over the past three months and stabilised at $365,000 in the June quarter, but still had a 15.8% jump over the past year. "The good news about this unchanged result is that we have not gone backwards. Many other cities fluctuate to large extremes but Adelaide tends to be more steady and reliable." REISA President, Robin Turner, said Units and apartments have also performed well with the median unit and apartment price for Adelaide CBD rising by 25.2% over the past 12 months to $349,500. People's lifestyles are changing and the number of people per household is dropping slightly too, so an apartment is a viable option for many.

The emergence of several high profile mines fueling the resource sector in SA coupled with defence force contracts boosting employment opportunities in the state has also created a demand for housing as more people move to the state to take advantage of job opportunities.

Compared to other states, SA housing is still relatively affordable. This makes it an attractive option for investors. Rental vacancy remains very tight which will keep pressure on rents which are responding with consistent increases. "The latest rental price data from the June quarter recorded Adelaide's median weekly rent for houses at $270 per week, up from $250 12 months ago. Units are now attracting $225 per week, compared to $195 this time last year."(REISA news, 21st July 2008).