While the demand for property has moderated across various parts of Australia, Adelaide has emerged as a champion in Australia. It is regarded as Australia’s new hottest capital city property market with the interstate migration pushing property prices to new highs.
The property market in Sydney, Melbourne, Brisbane is seeing a slow home sale. Out of the 1005 properties taken to auction in Sydney this past week just under 70 per cent of them were sold. Last year at the same time, more than 85 per cent of the property was sold.
A similar situation was seen in Melbourne as well. Out of the 1500 properties scheduled for auction, only 68.9 per cent were sold. Again a 10 per cent drop in points as compared to 2021.
The auction clearance rate in Brisbane which was slowly setting the pace in the market has also lost market interest. The clearance rate fell to a lowly 61 per cent.
The noticeable aspect was that despite the fall in the clearance rate, property prices remained strong.
According to CoreLogic, the auction clearance rate nationwide has been consecutively being under 70 per cent. This week marks the third with a clearance rate of 69.8 per cent.
However, Adelaide defied this trend this week with an 83.6 per cent clearance rate of properties taken to auction this week. The major catalyst and factor of this increased demand in Adelaide is interstate migration.
This demand won't slow down any time soon because of the population growth in Adelaide with people returning from interstate and the eastern seaboard.
Local agent and auctioneer Mark Sheppard of Harcourts Sheppard Property said, “Population growth is certainly fuelling our market, and then on top of that I don’t think interest rate rises will have a big impact on the Adelaide market because we’re coming from such a low point.”
Before COVID-19, Adelaide never saw interstate or overseas bidders but it is estimated that 20 per cent of bidders this week were from interstate or overseas. At an auction on Saturday for the property 24 Jellicoe Ave, Kings Park, two of the four bidders were from interstate. Although the property was sold to a local investor for $2.31 million.
According to Ray White from the Agency group, it was reported that 688 properties went to auction on its network over the past week but the highest interest was garnered by an Adelaide property (The Parade, Holden Hill house) with 31 registered bidders for it.
It was bought by a Hong Kong couple who want to retire in Adelaide for $720,000 which is $120,000 above the reserve price.
The leading role was played by overseas buyers in the sale of a five-bedroom home at Sydney’s 23 Ellery Parade, Seaforth. The property was sold for $8.1 million and had a price guide of $7.5 million. It was bought by a local family.
Monika Tu, Agent, Black Diamondz said, “We got thousands of inquiries, with the strongest interest coming from Singapore and Hong Kong.”
Younger families with a few children especially ex-pats who want space and better value than eastern suburbs are attracted to the Middle Harbour location and proximity to the northern beaches.
Melbourne market can be characterized by a lack of competition as very few people, sometimes only one person bids at the auction. To which, interestingly, buyers agent Emma Bloom of Morell & Koren quoted, “They are all one-horse races.”
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