An extra $60k in your pocket: SA property values climb to new high

A new report shows South Australian home values climbed again last month to a record high. Find out what the new median is and what’s fuelling the market.

South Australia’s property sector continues to show its strength on the national stage, with regional SA recording the highest growth of any market in the country over the past month, and metropolitan Adelaide the highest of any capital city.

PropTrack’s latest Home Price Index shows Adelaide home prices rose 0.81 per cent month-on-month to a record high of $709,000 in February, with combined dwelling values up 1.46 per cent since the start of the year.

In its March 2023 report, PropTrack had Adelaide’s median dwelling value at $648,000.

This represents an annual increase of $61,000.

Home prices in regional SA performed even better, up 1.09 per cent over the past month, and 12.15 per cent over the past 12 months to a $423,000 median.

The next closest regional increase was for homes in rural Queensland at 0.77 per cent.

Report author Eleanor Creagh said SA’s star continued to shine brightly.

PropTrack senior economist Eleanor Creagh. Picture: Supplied

James Packham, managing director of Harcourts. Packham.

“Adelaide is one of the country’s top performing markets, with home prices up 12.76 per cent year-on-year,” she said.

“The comparative affordability of the city’s homes has seen prices defy the significant increase in interest rates since May 2022.

“Low stock levels are also intensifying competition, with home prices in Adelaide rising at a fast pace in 2024.”

Adelaide’s house price has also reached a new high – up 0.82 per cent for the month and 13.05 per cent for the year to $760,000 – while metropolitan units have increased 0.7 per cent over the past month and or 10.29 per cent over the past 12 month to $538,000.

Since the start of the pandemic, March 2020, metropolitan Adelaide’s combined dwelling price has increased by 62.3 per cent, while units have increased by 63.7 per cent.

This outstrips the growth experienced across the nation for the same period, with Australia’s combined capital city dwelling price up by 33.7 per cent, and Australia’s regional median up 52.1 per cent.

Harcourts Packham managing director James Packham said SA’s price growth was tipped to track ahead of national averages.

“Our latest PropTrack Outlook Report forecasts national home prices to climb between 1 per cent and 4 per cent in 2024,” he said.

“While capital growth is only likely to be 1 per cent to 4 per cent for the year nationally, Adelaide is likely to outperform the national average and speculators predict that values will increase by 66 per cent by 2033.

“In the past decade from 2013 to 2023, growth was a national average of 67.5 per cent.”

According to the report, home values in Adelaide’s north have increased over the past 12 months by 16.03 per cent to a $612,000 median, while dwellings in Adelaide’s southern and central and hills regions have increased 12.57 per cent and 11.31 per cent respectively to medians of $739,000 and $882,000.

Adelaide’s homeowners are in the money.

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Regionally, home values in the Barossa-Yorke-Mid North area have increased by 12.72 per cent to $397,000, while home values in the state’s South East have climbed 12.61 per cent to $484,000.

Ms Creagh said, nationally, the market had performed strongly.

“More homes have hit the market this year, but demand has kept up with that increase,” she said.

“The expectation that interest rates will fall in the second half of 2024 is likely providing a positive tailwind for activity.

“Housing demand is also being buoyed by population growth, tight rental markets, resilient labour market conditions and recent home equity gains.

“Meanwhile, the sharp rise in construction costs and labour and materials shortages have slowed the delivery of new builds, hampering the supply of new housing.

“Looking ahead, the positive tailwinds for housing demand and a slowdown in the completion of new homes are likely to offset the impact of reduced affordability and a slowing economy. “As a result, prices are expected to lift further in the months ahead.”