Adelaide

The Smartline Report – December Edition

The month in review: Adelaide

By Herron Todd White
December 2016

The CoreLogic quarterly report released in August 2016 indicated that home values have recorded only a moderate rise over the past year. The number of home sales have remained reasonably steady across the city and the average selling time has reduced. On the other hand, discounting levels have increased a little as vendors become more flexible on their price expectations. Overall the Adelaide housing market is fairly steady.

Quarterly sales data released by the Real Estate Institute of South Australia indicates the top 10 growth suburbs with 10 or more sales in the current quarter. These include Gulfview Heights to the north of the Adelaide CBD, Sellicks Beach to the south of the city and Mile End and Brooklyn Park which are both situated within five kilometres of the western side of the Adelaide CBD. These statistics are based on detached housing.

There is a continuing issue of limited stock in many suburbs in Adelaide particularly within proximity of the CBD and in particular on the city fringe. We are hearing increasing feedback from selling agents in areas such as Parkside that many properties are being transacted privately without any exposure to the market. This has happened due to the low stock levels close to the CBD.

Given that the Adelaide market has remained steady, there have not really been any weak performers. As at September 2016, turnover across Adelaide has been trending higher which is bucking the trend seen in most capital cities. Adelaide’s auction market has shown a strong start to the spring season with clearance rates around 80% and higher auction volumes than this time last year (CoreLogic Leaders Forum Presentation September 2016).

While there have not been any major events in Adelaide, earlier in the year an announcement was made that the bulk of Australian submarines are to be built at Osborne ($50 billion contract to build 12 new submarines by the French shipbuilding company DCNS). There are estimated to be 1,700 jobs created at ASC (Osborne). There are also a number of large infrastructure projects underway including the Torrens to Torrens project, O-Bahn busway extension and Darlington Road upgrades.

The Torrens to Torrens project is progressing with milestones being regularly met. The photo below shows large beams recently installed for a large section of bridge over Port Road and a concrete pour being undertaken for a bridge over Grange Road.

The State Government has also announced the future Northern Connector Project will commence work in 2017. The 15.5 kilometre Northern Connector is the next section of the non-stop motorway linking Port Wakefield Road, the Northern Expressway, Port River Expressway, South Road Superway and the Salisbury Highway. The Northern Connector project supports the Northern Economic Plan which is a blueprint for a prosperous northern Adelaide, focused on creating jobs and empowering local communities.

The Australian Government is contributing $788 million and the State Government $197 million to deliver the $985 million project. (Source: http://www. premier.sa.gov.au)

Despite South Australia’s unemployment and job insecurity issues including the imminent closure of Holden, the State Government is helping to create new jobs from these projects. In the medium to long term, the property market in South Australia remains positive.

We are yet to see the impact (if any) the recent U.S. election result will have on the Adelaide property market. We will monitor this in coming months.

Predictions: Clarence Gardens, Modbury, Ridgehaven, Dernancourt, Clearview, Payneham South, Richmond

The predicted areas have remained steady in terms of growth since February. Clarence Gardens and Payneham South in particular are experiencing quite low levels of stock. Richmond is adjacent to Mile End and Brooklyn Park which have both had a positive 12 months given the median price change.

South Australia officially has a new record residential sale. An iconic Gilberton mansion known as Ivanhoe will settle shortly for $7 million. We understand that although this off-market transaction was due to settle last Christmas, settlement was extended to mid-November 2016 (source: The Advertiser). Gilberton is a highly regarded and tightly held area situated within four kilometres of the Adelaide CBD.

An iconic city mansion known as St Coratyn has been listed for sale since April 2016. While there was some speculation that this property may become the record sale, a recent price reduction indicates this is unlikely to be the case.

Find out more information and to chat with a local Mortgage Broker in Adelaide.

www.smartline.com.au

Please note that information in this publication is subject to change without notice. Smartline assumes no responsibility for any errors, omissions or mistakes in this document. © Smartline Home Loans P/L 1999 – 2016. Australian Credit Licence Number 385325

 

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