2014 proved itself to be a solid year for property in Adelaide and 2015 is shaping up to be just as promising, with new research from CoreLogic RP Data showing that the cost of housing across the capital cities increased by 1.3 per cent over the first month of this year.
This news came before the Reserve Bank of Australia's landmark decision to cut the official cash rate down to 2.25 per cent, but it further highlights that Australia's property market is in a great position as the year goes on.
Housing construction is also providing ideal support for the property sector, with ABS data showing that dwelling approvals hit strong levels in the last month of 2014. Medium to high density units are tracking along nicely nationwide and Adelaide investors in particular are showing a growing taste for apartment living. Multi-unit approvals in South Australia rose by an exceptional 130.6 per cent in 2014 according to the Housing Industry Association (HIA).
However, Tim Lawless of CoreLogic pointed out detached houses still hold poll position, making up slightly less than one-third of all building approvals across Adelaide in the year to November 2014. Investors are still seeing better results from these types of investment properties as well.
In the long run detached housing is likely to be the stronger performer for capital growth elsewhere in the country but this might not be so clear cut in Adelaide. While most capital cities saw a lower rate of capital growth in the unit market than for houses, Adelaide was one of the exceptions, along with Canberra.
Capital gains from units were up 4.5 per cent in January while houses only rose 2.9 percent. According to Mr Lawless, this follows on from higher supply levels for high density housing in other cities, but indicates houses are clearly still in demand in the city of churches, which leaves units open for fantastic capital gain.
2015 has started off on the right note, so if you want to get ahead of the property curve speak with a local real estate agent about how investing in houses in Adelaide can maximise your portfolio's earnings.