SOUTH AUSTRALIA OUTLOOK Rental The rental market in South Australia is expected to be flat, except in the state’s west where job losses are putting additional pressure on those in tighter financial circumstances. This should see flat vacancy rates, especially on the Yorke Peninsula and Adelaide Plains region, with some downward trend on the Fleurieu Peninsula. In areas susceptible to job insecurity, vacancy rates may rise slightly. Strong demand will keep pressure on weekly rents, where any falls will be a result of an oversupply situation. In the first six months of 2012, rents in Adelaide were reasonably flat, and vacancy rates dropped by 0.1% in February. The average yield for houses in Adelaide is 4.3% and the average yield for units is slightly better at 4.5%.
Growth Investor activity is expected to increase by 75% of South Australia members, as a result of prime market conditions. These include improving rental yields and returns, increased affordability through low interest rates, and falling prices. 50% of members believe investors represent the strongest growth segment, however, the balance say it will be upgraders looking to capitalise on improved affordability, making it cost effective to upgrade now.
Trends Interest rates are expected to continue being low, if not further decrease, for the remainder of 2012 by South Australia members, which will serve to underpin sales. The most active sector of the market, according to all South Australia members, will be the entry level market where home values are less than $350,000. Solar power and energy, drought resistant gardens and the ability to open windows remain the most sought-after energy efficient features of a South Australia property.
2012 PROPERTY MARKET OUTLOOK – MID YEAR UPDATE FIRST NATIONAL REAL ESTATE
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