Adelaide Property Market Predictions 2024 – A Steady Rise in House Prices and Rentals

Adelaide's real estate market has consistently shown steady performance, setting it apart from other major cities like Sydney. While other cities experience fluctuations, Adelaide remains a steady and reliable market. According to SQM research, Adelaide's units and dwellings have achieved a commendable combined growth of 9.9% over the past year.

Adelaide's Consistent Performance

Terry Ryder, the founder of Hotspotting, describes Adelaide's property market as the "Mister Consistent" among capital city markets. Even during 2022 when larger cities slumped, Adelaide continued to deliver consistent performance. However, it didn't experience the same level of vibrancy as Sydney, Melbourne, and Brisbane.

Caption: Terry Ryder

Daniel Walsh, founder of Your Property Your Wealth, attributes Adelaide's recent growth to its shortage of new stock. Compared to the previous five years, there has been a 32% decrease in new housing construction. Despite rising interest rates, Adelaide has continued to push forward in terms of price growth.

The Forecast for 2024

Experts predict that Adelaide's property market will continue its climb in 2024, albeit at a steadier pace compared to 2022 and 2023. Cameron Kusher, the director of economic research at PropTrack, expects prices to rise by between four and seven percent. This projection is based on the impact of interest rate increases and the broader economic slowdown. The relative affordability of the city, strong demand, and limited new housing construction will counterbalance these factors.

Caption: Cameron Kusher

Daniel Walsh suggests a similar forecast, depending on the direction of interest rates. If interest rates drop in the latter half of 2024, the growth may range from three to five percent. However, Terry Ryder expects prices to rise by more than five percent, fueled by the ongoing supply and demand imbalance.

Rental Market Challenges

Adelaide's rental market is facing an uphill battle. The vacancy rate sits at a mere 0.5%, the second lowest in the country, right after Perth. Daniel Walsh predicts an ongoing undersupply for renters due to high interest rates, leading to difficulties in finding suitable rental options. As a result, weekly rents have seen an annual rise of 12.7%, with the average across all dwelling types now at approximately $612.

International Interest in Adelaide

Juwai IQI co-founder and group managing director, Daniel Ho, describes Adelaide as the "just-right" market. While it may not be the hottest market in Australia, it has its own unique appeal. Adelaide ranks as the fifth most popular destination for Chinese buyers, with many purchasing homes to live in. The affordability of the city is a significant draw, offering levels that are unimaginable in other major capital cities. Additionally, Adelaide's slower population growth ensures that the current housing shortage is well-managed by developers.

Suburbs Poised for Growth

According to Terry Ryder, the northern suburbs of Adelaide, particularly Salisbury and Playford, are experiencing above-average growth and buyer demand. For those looking to invest in Adelaide, properties with larger blocks are worth considering due to their scarcity. The price bracket of $550,000 to $700,000 is expected to experience the most significant price pressure.

Adelaide's property market is primed for a steady rise in both house prices and rentals in 2024. Investors can expect a reliable market with consistent growth and the potential for attractive rental returns. With its affordability, limited supply, and increasing demand, Adelaide continues to be an enticing destination for both local and international buyers.

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