Adelaide’s northern and southern suburbs could record a property price increase of nearly 7% by 2021, according to CoreLogic-Moody’s Analytics Australian home value index forecast.
The findings showed that house values in the city would likely rise by 0.4% in 2019, 2.7% in 2020, and 3.6% in 2021.
The predicted rise would push Adelaide’s current median price of $450,000 to $480,150, according to Moody’s Economist Katrina Ell.
“Housing values in Adelaide rose 1.9% in 2018 and Moody’s Analytics forecasts housing values will continue to accelerate,” she told realestate.com.au. “Within Adelaide, the north and south areas will remain the driving housing markets. Northern Adelaide is expected to remain robust despite slow gains in recent years because it has the best fundamentals compared with surrounding regions. Nearly 50% of Adelaide’s total population gain from 2016 to 2017 was in Adelaide’s north.”
The northern region posted an increase in employment, with the unemployment rate dropping over the past two years. Southern Adelaide’s labour market, meanwhile, also improved.
Billion-dollar infrastructure projects across the state played a part in the strong market demand across South Australia, according to Real Estate Institute of South Australia President Brett Roenfeldt.
“Prices will only go up from here as our market is driven by supply and demand. Adelaide is currently faced with a lack of stock of quality homes, which is creating greater market competition and driving up prices and I can’t see that change anytime soon,” he told realestate.com.au. “Traditionally, it used to be the inner suburbs that have been driving up prices, but due to low stock levels and affordability, that has now been pushed out to the northern and southern areas. The northern suburbs in particular, because of the new expressway, are in strong demand but again, stock levels are low even in those other areas.”
Adelaide’s market resilience is due to its avoidance of unsustainable price increases, according to Alex Ouwens, managing director of Ouwens Casserly Real Estate.
“Adelaide has been the steady performer even through the closures of significant manufacturing companies in Adelaide’s north. Jobs were lost, but they have been taken up through other new industries in defence, space, and renewables… the SA business confidence index is at its highest since pre-GFC,” he told realestate.com.au. “With the RBA showing signs of interest rates being further reduced and the Australian Prudential Regulation Authority loosening up the purse strings for banks to offer more loans to customers, it all bodes well for a further period of sustainable capital growth and increased rental yields for property investors looking at SA for a place to live and invest.”
