Median Adelaide house price to be at least $1 million by 2024 — Home Loan Experts

THE median house price in Adelaide will reach $1.038 million in the next decade, a mortgage broking firm has predicted.

THE median house price in Adelaide will reach $1.038 million in the next decade, a mortgage broking firm has predicted.

Analysis by Home Loan Experts has found the median house prices in all mainland capitals is set to climb beyond $1 million.

While it will be music to the ears of current owners, for hopeful homebuyers it means they will be further squeezed out of the property market.

National house prices have skyrocketed at a rate of 8.43 per cent in the 30 years to 2010 and given recent soaring growth rates it is predicted Australians will need to find much larger deposits to afford properties.

Home Loan Experts believe Sydney will remain the most expensive city — the average median house price in 2024 is tipped to hit $1.824 million.

What about the kids ... In 2024, the median house price in Adelaide will be $1.038 million. Picture: Thinkstock

Darwin is the next worst with a median house price of $1.473 million. Perth is next ($1.392 million), followed by Melbourne ($1.366 million).

In Brisbane, the median house price is set to reach $1.072 million, and Canberra $1.295 million. Hobart is the only capital that is not predicted to reach $1 million and will reach $740,000 by 2024.

Toop & Toop managing director Anthony Toop said the $1 million-plus prediction for Adelaide was “not beyond possibilities”. “We are the cheapest mainland capital, so the rest of the country will be at a million before us ... it may take us an extra couple of years,” he said.

“No one ever thought that we would be where we are if you rewind the clock 10 years. It’s just a reality that every 10 years prices pretty much double.”

Real Estate Institute of South Australia chief executive Greg Troughton said he would not be surprised if Adelaide’s median price of $429,000 doubled during the next decade. “We work on a general rule of thumb that property prices double so it will go pretty close to ($1 million),” he said.

Household incomes not keeping pace with rising house prices ... Otto Dargan, principal of Home Loan Experts. Picture: Bob Finlayson

Home Loan Experts managing director Otto Dargan is adamant property prices will continue to rise and he said homeowners would need to look at smaller properties, including apartments. “The days of the quarter-acre block are coming to an end,’’ he said.

“Living in apartments will continue to become a trend. ’’

Mr Dargan said household incomes had not kept pace with climbing house prices, making houses were even less affordable.

According to RP Data figures national house prices grew at a rate of 8.43 per cent from $37,500 in 1980 to $425,500 by 2010.

RP Data’s senior research analyst Cameron Kusher believes Sydney house prices could push beyond the $1 million mark but said it would be difficult for the other capitals to do this with historic price rises unlikely to continue at the same pace.

According to RP Data figures national house prices grew at a rate of 8.43 per cent from $37,500 in 1980 to $425,500 by 2010.

In Brisbane the median house price is set to reach $1.072 million in the next decade, Adelaide $1.038 million, Darwin $1.473 million, Perth $1.392 million and Canberra $1.295 million.

Hobart is the only capital that is not predicted to reach $1 million and will reach $740,000 by 2024.

RP Data’s senior research analyst Cameron Kusher believes Sydney house prices could push beyond the $1 million mark but said it would be difficult for the other capitals to do this with historic price rises unlikely to continue at the same pace.

Does not expect house prices to continue rising at same rate ... Cameron Kusher, RP Data’s senior research analyst.

AMP’s chief economist Shane Oliver said Australia has very expensive housing and wage growth had failed to keep up.

He said there would be continued house price growth in the coming decade but it’s likely to be at a slower pace.

“The ratio of house prices to household income is around six times in Australia whereas it’s about three times in the US,’’ Mr Oliver said.

“I think there will be years in there where there will be great runs but there will be years where they come off the eight per cent growth rate.”

LIST YOUR HOME OR STAY PUT FOR CHRISTMAS

By Tom Bowden

VENDORS hoping to sell their house in 2014 must act now or miss out on sealing the deal before New Year, real estate agents say.

Toop & Toop Real Estate director Anthony Toop said an auction campaign was people’s best chance of snagging a quick sale, but stressed sellers must act immediately.

POSITIVE: Matthew and Elena Hobby with James, Harry and Mila, Picture: TOM HUNTLEY

“From the moment someone decides to sell, there’s about two weeks lead time as a rule where they need to appoint the agent and get the campaign in place, so that takes us through to an auction launch on November 29,” Mr Toop said.

“An auction campaign can be successfully done with two weekend opens and then with the auction on December 20, and then that’s it for the year.”

Harcourts acting chief executive officer Andrew Friebe also recommended auction for those looking to sell before the end of the year.

Matthew and Elena Hobby’s 12 Bosanquet Ave Prospect home will hit the market through Toop & Toop next weekend and Mr Hobby said he was confident for a quick sale at auction.

“It’s going to appeal to young families and they’re all going to be around looking and full of Christmas cheer and hopefully in the mood to buy a house,” he said.