Adelaide went through a rough patch with the closure of major manufacturing plants in recent years. However, the city is regaining its momentum.
“With the pace of capital gains slowing, we may see a slightly lower rate of dwelling value growth in 2019; however, we expect the trend in housing values to remain positive, driven by improving economic conditions and interstate migration rates as well as healthy levels of housing affordability,” says CoreLogic head of research Tim Lawless in his outlook for 2019.
The housing market as a whole has been fairly steady over the five years to 2018, and while the regional areas of SA have not done as well as the capital, they are catching up quickly.
“The last five years have seen dwelling values trend 0.1% lower each year, although the past 12 months have seen this mild downwards trajectory flatten out, and we could see some mild growth return to the regional areas of the state in 2019,” Lawless says.
The southeast region of SA enjoys the strongest conditions, but this trend is expected to spread to other pockets, like the Barossa-Yorke-Mid North. This comes as a result of rising commodity prices and investments in the private sector.
Infrastructure projects support the market
Some of the top-performing suburbs in the state are in the inner and middle rings of Adelaide, such as Parkside, Kilburn, Newton and West Beach. The boost to the residential sector has been supported in part by the improvements to the industrial sector – defence spending has increased in the 12 months to December 2018.
This, along with initiatives for infrastructure improvements, has helped support the industrial sector, according to Herron Todd White’s Month in Review report for December 2018. Much effort has gone into road upgrades, such as the Torrens to Torrens and Darlington projects.
In addition, the site of the former assembly plant for Mitsubishi Motors, Tonsley, is being developed into a mixed-use pocket for high-value manufacturing, commercial and residential purposes. Tonsley’s commercial centre makes use of what was once an 80,000sqm warehouse called the Main Assembly Hub, which now houses shops, cafes, services and retail facilities.
SUBURB SPOTLIGHT
NURIOOTPA: Affordability propels growing suburb
The commercial centre of the famous Barossa Valley, Nuriootpa is a haven for those who enjoy great produce and excellent wine from the many local wineries in the region.
Demand has been on the rise in this suburb, with both house and unit values increasing steadily since 2013. At the same time, properties are quite affordable: the median house and unit prices were under $330,000 and $250,000 respectively.
Nuriootpa’s rental market for houses has also been on the up, recording rent increases of 6.5% to $330 per week in the year to October 2018. By contrast, the rental rate for units went down by 9%.
Amenities: As the commercial hub of the Barossa Valley, Nuriootpa is a hotbed of good food and wine
Affordability: House and unit values are at $329,566 and $245,110, respectively
