Adelaide September 2017

The month in review: Adelaide

By Herron Todd White
September 2017

Home buyers are active in the Adelaide market at present. The typical catch cry regarding proximity to the CBD consistently applies to the market. Detached housing (character in particular) within proximity to the CBD continues to be appealing for home buyers. There is consistent market activity from second home buyers, particularly those upgrading to a larger and/or renovated dwelling. There appears to be increased upward pressure on properties in this price range as first home buyers are consistently older than previous generations. This is causing some competition in the market as this market segment has been typically saving for a deposit for a longer period of time and is keen to secure a property.

A typical home owner in Adelaide is a family although there is continued activity from investors particularly in suburbs undergoing in-fill development. Discussions with some local agents have suggested that interest from investors in some areas has slightly declined in recent times since the recent rate rise in investment loans and the tightening of lending policies for apartments.

In the $500,000 to $800,000 price range, there is always activity in city fringe suburbs. Home buyers who can purchase a quality property under $500,000 within proximity to the CBD are typically in an appealing position.

Detached housing continues to be regarded as better by home buyers in the Adelaide market. Purchasers seeking quality property in proximity to services and the CBD are having to reconsider their options in this regard due to upward pressure on prices and decreased supply.

There is increased advertising of apartment complexes in the Adelaide CBD directed towards retirement living. We understand a soon to be completed complex on South Terrace has been primarily sold to home owners down sizing from large family homes. We will continue to monitor this market for changes in future.

Home buyers looking at attached housing may seek out higher quality fittings and fittings whilst an investor is typically seeking a low maintenance property with potentially less regard for high quality items. Also, investors generally prefer newer housing due to potential depreciation benefits.

The market on the move in Adelaide continues to be purchasers upgrading to larger properties, typically family homes.

The next generation in Adelaide haven’t given up but are having to reconsider their options. Detached housing is less attainable in some areas and first home buyers will need to consider attached housing, townhouses or units as possible alternatives.

It is becoming increasingly difficult for purchasers with a single income to enter the market at this price point without a substantial deposit to cover stamp duty in particular.

Some home buyers are purchasing their first property as an investment whilst continuing to reside in share accommodation or in their family home. As a result, there are less empty nesters as older children remain at home for longer.

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