While Adelaide’s property market may be moving at a sluggish pace in the near-term, the city and the broader state of SA have performed well for investors over the long-term.
RP Data research shows that of all homes sold in SA during the December 2012 quarter, around 30% achieved a sale price of more than double their initial purchase price.
The average capital gain was $261,144, while the average hold period for SA homes was 13.2 years. In Adelaide, the windfall was even higher at $282,813.
“SA is currently lacking the drivers for growth in the near term, but has outstanding long-term prospects both for the overall economy and well located residential property,” says Andrew Peterson of the NextHotSpot.com.au.
Peterson adds that projects like the rezoning plan for Brighton Road in Hove are worth keeping an eye on.
Under the proposal, the maximum height for buildings along a 1.5km section of Brighton Road would go from two storeys to four storeys. Up to 12 houses would also be rezoned from residential to commercial and could be converted into parking.
“The rezoning would likely hurt adjacent housing, but potentially benefit unit pricing nearby,” Peterson says.
“But as economies and city populations grow, there is a trend toward smaller dwellings with good CBD and lifestyle access – particularly on transport links, which this rezoning looks to support. Obviously the devil is in the detail, but this is an area and a rezoning process worth watching as the SA economy waits for more impetus.”
