SEVEN FACTORS THAT HAS MADE SOUTH AUSTRALIA A STAND-OUT MARKET IN AUSTRALIA
MATT LINDBLOM , RAY WHITE SA | NT CEO
We ’ ve all seen so much change in our lives since early 2020 when COVID-19 seemed to turn our lives upside down . Without realising it , this moment was actually the beginning of the strongest property market many parts of Australia and New Zealand have seen , and may ever see , with South Australia being no exception to this rule .
Adelaide and South Australia have traditionally lagged well behind the eastern states and Western Australia , with historically slower capital growth , higher unemployment and a net migration loss to other states . So , why has this changed in the past two years and will the strength of South Australia continue ?
1 . REMOTE WORK AND ONLINE
MEETINGS became a necessity through COVID-19 and now that we ’ re getting back to the new normal , these flexible and often hybrid workplace arrangements are here to stay for people in many job types .
2 . THE MELBOURNE FACTOR has also had a big influence on the growth of Adelaide and South Australia . Residents of the most locked down city in the world decided to move , and while many relocated to south-east Queensland , a large percentage also decided to remain south and move 700km to the west where there is more sun and you could still go and see a game of AFL .
3 . FINANCIAL IMPACT was felt by a significant number of people during the panademic , with industries such as hospitality , retail and tourism trading through very challenging times in 2020 and 2021 . With Adelaide being a relatively inexpensive place to live , many of those impacted financially decided to sell up in Sydney and move to Adelaide . One buyer said : “ the living area of the house we just purchased in Adelaide is the same size of my apartment in Bondi , we ’ re less than 10 minutes to the city and I have $ 500,000 in change .”
4 . THE MOST LIVEABLE CITY IN 2021 WAS DISCOVERED ! Adelaide has hardly been
known as the most popular tourist destination , but with international travel all but wiped out for the best part of two years , many of us ventured to parts of Australia not seen before , with Adelaide and South Australia being a big beneficiary of this . The city and state were finally discovered for its enviable lifestyle , low cost of living , ease of getting around , amazing coastlines and a city bookended by two famous wine regions : with McLaren Vale down south and Barossa Valley up north .
5 . GEOGRAPHY AND SPACE were a big influence over the past two years with a greater appreciation for the advantages of what having space really means to individuals and families . This is contrasted with the vertical living that comes with an ever growing centralised population in Australia , let alone the rest of the world .
6 . EXPATS RETURNING HOME IN 2020 had a big impact on increasing demand for properties in South Australia with the state previously experiencing net migration loss not only to the eastern states , but to international cities such as London and Hong Kong . With many wealthy expats returning home due to COVID-19 , this really influenced upwards pressure on house prices .
7 . MORTGAGE RATES ON THE WAY UP always have a greater impact in the Melbourne and Sydney property markets compared to the rest of Australia due to the higher median house prices and therefore the more sensitivity to increased mortgage rates with bigger home loans . While Adelaide ’ s median house prices have increased a lot during the last two years , they ’ re still substantially lower and more affordable than Sydney and Melbourne .
THE WORLD AND PEOPLE HAVE CERTAINLY CHANGED SINCE 2020 AND THE QUESTION NOW IS : WHAT HAPPENS FROM HERE ? AT THE TIME OF WRITING THIS , ADELAIDE AND SOUTH AUSTRALIA CONTINUE TO OUTPERFORM MOST OTHER MARKETS ACROSS THE COUNTRY SO IT WILL BE INTERESTING IF THIS TREND CONTINUES AND ONLY TIME WILL TELL .
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