- Adelaide saw home prices rise to a new peak in April, up 0.41%
- Low stock levels are also helping to insulate home values
- Competition among buyers is high
The Adelaide property market maintained its top spot as the strongest performing capital city despite the Reserve Bank of Australia (RBA)’s string of rate hikes, according to analysis from PropTrack.
The company’s Home Price Index found that, in line with national trends, property prices across the South Australian market and Adelaide’s market have seen upticks in recent months.
PropTrack Senior Economist Eleanor Creagh says Adelaide’s growth in April was the strongest monthly pace of price growth across the country.
“Adelaide saw home prices rise to a new peak in April, up 0.41%,” she said.
“Adelaide maintained its top spot as the strongest performing capital city market over the past year, with home prices up 5.23%.”
Eleanor Creagh, PropTrack Senior Economist
As interest rates have risen quickly, the relatively affordable prices of homes in the city have helped to support their value, Creagh says.
“Low stock levels are also helping to insulate home values, with increased competition among potential buyers.”
Highly motivated buyers
Australian Bureau of Statistics (ABS) data indicates that the value of new loan commitments for owner-occupiers and investors within South Australia fell 4.9% and 11.4%, respectively, in January.
New loan commitments for owner-occupier housing (seasonally adjusted)
Herron Todd White Property Valuer Nick Smerdon explains in the report that the South Australian market may have lower transaction levels, but those in the market are moving fast.
The company’s April Month in Review report reveals the number of total listings in South Australia is still 6% lower than the previous year, while the median days on market have remained stable at 35 days, one day more than the same period last year.
“The data is suggesting that even though purchasers are removing themselves from the market, those buyers still active are highly motivated,” Smerdon says.
Buyer types
The Month in Review report highlights that the South Australian market is being driven by a variety of buyer types.
“These are made up of first homebuyers who missed out during the peak of market activity, upsizers who need to buy out of necessity, downsizers who have less reliance on lenders and investors looking for a market with a track record of stability during a national downward cycle,” Mr Smerdon says.
“Buyer motivation and circumstance ultimately decide into which buyer type a purchaser is lumped.”
