South Australian Property Market: Key Insights from the CoreLogic Monthly Housing Chart Pack

The South Australian property market is showing strong resilience and growth, particularly in Adelaide. A review of the CoreLogic Monthly Chart Pack for June highlights key metrics that demonstrate the market's activity and potential opportunities.

Dwelling Values: A Steady Rise

Adelaide’s dwelling values have seen a significant increase over recent months.

• Quarterly Change: There was a notable rise of 1.8% in dwelling values over the past three months.
• Annual Change: Over the past year, dwelling values surged by 14.4%, reaching an all-time high. This upward trend underscores the strong demand and limited supply in the housing market.

Rental Market: Strong Growth Continues

The rental market in South Australia has mirrored national trends, with rents rising steadily.

• Annual Change in Rental Rates: National rents saw an increase of 8.5% in May. Regional South Australia contributed to this growth, reflecting the broader trend of increasing regional rental values.
• Gross Rental Yields: Gross rental yields in regional South Australia have been on the rise, contributing to the national average which reached 3.75%, the highest since October 2019.

Listings and Sales: High Activity and Absorption

The listings and sales data indicate a highly active market with significant buyer interest.

• New Listings: There was a 7.3% increase in new listings compared to the same period last year, and a 17.2% increase compared to the five-year average. This indicates strong seller confidence and a robust market.
• Total Listings: Despite the high number of new listings, total stock for sale was 138,519 over the four weeks to June 2nd. The market’s high absorption rate keeps overall listings subdued.
• Sales Volume: In May, an estimated 42,944 homes were sold nationally, with annual national sales up 7.1% from the previous year. Adelaide's strong market activity contributes significantly to these figures.

Market Dynamics: Efficiency and Competitiveness

Key market dynamics further highlight the competitiveness of the South Australian property market.

• Median Days on Market: Nationally, the median time on market was 31 days in the three months to May, maintaining the same pace as the previous year. South Australia aligns with these trends, indicating a balanced market.
• Vendor Discounting: The median vendor discount in South Australia was -3.3% over the three months to May. This is reflective of a market where sellers have some room to negotiate, but not excessively so, indicating healthy demand.

Investor and First Home Buyer Activity: Balanced Growth

Both investor and first home buyer segments are showing strong activity.

• Investor Lending: Nationally, investor finance made up 37.0% of new mortgage lending through April, up slightly from 36.7% in March. South Australia follows this trend, with investors actively participating in the market.
• First Home Buyers: The value of first home buyer finance increased by 3.4% in April to $5.4 billion. First home buyers accounted for 29.2% of the value of owner-occupied lending, showing robust entry-level activity.

Housing Approvals and Finance: Slight Dip but Steady Lending

The housing approvals data presents a mixed picture, but lending figures remain strong.

• Dwelling Approvals: There was a slight decline in dwelling approvals, down 0.3% in April, driven by a 1.0% fall in detached housing approvals. However, this was partly offset by a 1.1% rise in multi-unit approvals.
• Home Lending: The value of home lending rose by 4.8% through April, with owner-occupier finance making up 57% of this increase. Investment property lending also saw a monthly rise of 5.6%, reflecting ongoing confidence in the market.

The South Australian property market, particularly in Adelaide, is showcasing robust growth across various metrics. The increase in dwelling values, active rental market, and high levels of listings and sales all point to a dynamic and healthy property environment. Both investors and first home buyers are actively participating, supported by steady lending and slight variations in housing approvals.

Source - CoreLogic Monthly Housing Chart Pack June 2024