The Smartline Report – September Edition

The month in review: Adelaide

By Herron Todd White
September 2016

Cream brick conventional style dwellings were popular particularly in the 1960s and 1970s. Many of these are being demolished to make way for modern courtyard dwellings on more compact blocks.

Zoning changes among a multitude of Adelaide council areas are resulting in increasing in-fill development and townhouse and apartment style living. Much of this market segment is being driven by investors given the decreasing number of first home buyers. Local government areas where there is increasing prevalence of this include Campbelltown, Onkaparinga and Tea Tree Gully.

An example of this in-fill development is shown below. The first image left shows a circa 1960s single level dwelling situated on a 696 square metre corner allotment in the suburb of Campbelltown. The property sold in late 2014. Recent zoning changes in this area mean the site has been subsequently developed and four two-storey dwellings have been constructed.

Villas, bungalows and cottages are the mainstay of character areas particularly those on the city fringe such as Unley, Norwood, North Adelaide, Prospect and Mile End.

North Adelaide is known for its large proportion of character housing with house styles in North Adelaide including Early Victorian Houses (1840s to 1860s), Victorian Houses (1870s to 1890s), Edwardian Houses (1900 to 1920s), Inter-War Houses (1920s to 1942) and Post War Housing (1950s plus). (Reference: City of Adelaide Development Plan).

While these areas have undergone varying levels of in-fill development over the past few decades, the appeal of character dwellings continues for Adelaide residents. Character dwellings which have been extended and renovated provide potential purchasers with the character of past eras with modern amenities.

Character properties are also popular in areas outside of the city fringe such as Colonel Light Gardens which was originally a model garden suburb known as Mitcham Garden Suburb. House styles in this area reflect the popular preference for Californian Bungalows.

At the time of writing, there were limited dwellings on the market in many of the areas listed above. This scarcity is also continuing to drive demand.

Many busy potential purchasers in the Adelaide market are chasing the elusive work-life balance and are therefore seeking properties where everything is done. Lower maintenance properties mean more time to spend with family and friends. Popular property types as always are dependent on life stage. For example, many young families are still keenly seeking larger family homes with a back yard while those downsizing appreciate the low maintenance lifestyle that a new property on a smaller allotment offers. Given the increasing townhouse and apartment construction in the CBD and surrounding suburbs, potential purchasers in Adelaide are gradually moving away from large detached dwellings particularly in less affordable locations.

Quality housing in suburbs within ten kilometres of the CBD has always been attractive to long-term investors and this is the same for home owners. Suburbs that provide proximity to the CBD, good shopping facilities, access to public transport, reserves and local cafes are attractive for investors and home buyers alike. Increasingly, there are limited properties under $500,000 within suburbs close to the city. The market for older units even close to the city is somewhat stagnant as there are larger numbers of newer apartments and townhouses on the market and decreasing numbers of first home buyers that may have previously considered a unit for a first home.

As a result, there are more residents moving further from the CBD to seek housing within an affordable price bracket. There is increasing in-fill development within suburbs such as Happy Valley as well as new development in Woodcroft which is improving the overall appeal of these suburbs. Although further from the CBD, these locations are well serviced with local shopping facilities in good proximity. These suburbs provide good opportunities for first home buyers seeking detached housing within the $300,000 to $400,000 price bracket. These opportunities are few and far between within close proximity of the CBD with the exception of smaller
unit style accommodation. These areas have fairly consistent levels of demand from buyers and tenants alike.

An example of the price differences between suburbs is shown below. Woodcroft is situated 20 kilometres from the Adelaide CBD, while Parkside (situated in the Unley Local Government Area) is situated within three kilometres of the CBD.

A property on Mawson Circuit, Woodcroft sold in March 2016 for $330,000. It is a circa 1994 3-bedroom, 2-bathroom dwelling with single garage (under the main roof) on a 435 square metre allotment.

In comparison, a circa 1990 3-bedroom, 2-bathroom dwelling (350 square metre allotment) on Kenilworth Road, Parkside sold for $705,000.

This reflects a 47% difference in price and provides a good indication of the impact proximity to the CBD has on a property. The median house price in Woodcroft is $365,000 while in Parkside it is $705,000.

In summary, well serviced, quality housing within proximity of the CBD will continue to experience good demand. Coastal areas such as Henley Beach and Grange will also remain popular given their proximity to the beach and good access to the city and surrounding shopping and café facilities.

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DISCLAIMER: The information contained in this article is correct at the time of publishing and is subject to change. It is intended to be of a general nature only. It has been prepared without taking into account any person’s objectives, financial situation or needs. Before acting on this information, Smartline recommends that you consider whether it is appropriate for your circumstances. Smartline recommends that you seek independent legal, financial, and taxation advice before acting on any information in this article.