The month in review: Adelaide
By Herron Todd White
July, 2010
Residential purchasers with $500,000 to spend are spoiled
for choice in Adelaide so some parameters are required.
House or apartment; owner occupy or invest; capital
growth or rental return? Half a million dollars will get you
into a basic house in the inner south, western or northern
suburbs within 10km of the city – you should not expect
the house to be too grand but in terms of capital growth,
these inner suburbs are considered a good option in the
longer term. In these areas it is relatively easy to find
tenants however return will be limited by the quality of
the accommodation.
As would be expected, housing becomes more affordable
away from the city and a renovated family home 10-
20km from town would bring change from $500,000
in the majority of cases. Rental return is a reflection of
the quality of the property and better returns would be
expected although to the detriment of capital growth.
Cashed up investors seeking to maximise rental return
would be attracted to the established outer (northern)
suburbs where the entry level is in the vicinity of $200,000.
In these areas, the quality of the home is not so important
as proximity to services, shops, schools and transport.
Inner city apartments and home units are in plentiful
supply and offer a range of options and price ranges.
In most cases, finding a tenant is not difficult and the
majority of the stock is relatively new meaning minimal
upkeep. Coastal areas too are popular for apartments,
smaller dwellings and home units – all attainable within
the $500,000 budget. These areas have shown reliable
capital appreciation and rental return over time.
Not a lot has changed in the Adelaide $500,000 residential
bracket over the past year. As for most sectors, the
volume of residential sales has fluctuated over this time
in response to interest rates and consumer confidence.
We believe the market will stabilise in coming months
as interest rates work themselves out and the Federal
Election approaches.
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