Adelaide has a handful of suburbs that are tipped to join the million-dollar club in the next year despite the market cooling. Picture: NCA NewsWire/Brenton Edwards.
Three once-affordable Adelaide locations are among the country’s next in line to join the million-dollar club despite the broader market cooling.
Sheidow Park-Trott Park, McLaren Vale and Golden Grove have median house prices that are tipped to cross the seven-figure threshold in the next year.
They are among 13 locations across the nation expected to become million-dollar areas, the majority of which are in Perth while one is in Darwin.
Ray White Group has identified the areas based on their price – between $900,000 and $1m – investor activity – below a 19 per cent share – and strong growth.
Economist at Ray White Group Atom Go Tian said a pipeline of low-investor areas were still climbing toward million-dollar medians with double-digit growth, even as investor-heavy markets cooled around them.
Ray White Group economist Atom Go Tian.
“High interest rates, global uncertainty and federal budget changes targeting investor activity are all pointing toward slower growth ahead,” he said.
“But just as the boom of the last three years disproportionately benefited regional Australia and smaller capital cities, the slowdown won’t land evenly either.
“The key reason is investors are not evenly distributed.”
Mr Go Tian said the areas where investors were least prominent, below 19 per cent, tended to be more affordable, owner-occupier driven and still growing.
Like Perth’s, Mr Go Tian said the Adelaide areas approaching the threshold were once more affordable options that weren’t attracting many investors.
Australia’s next million-dollar suburbs in a cooling market. Source: Ray White Group.
“All three carry investor shares of 11 to 13 per cent and are growing at 10 to 12 per cent annually,” he said.
The biggest risk for these areas, Mr Go Tian said, was that they were approaching the ceiling of what many owner-occupiers could afford.
“What the data tells us is that these suburbs are the least exposed to the specific headwind the market now faces,” he said.
“That is not a guarantee of continued growth, but in a market about to slow unevenly, it is the strongest position to hold.”
It comes as latest PropTrack data shows Adelaide’s property market is showing early signs of easing, with the median dwelling price falling 0.2 per cent in June to $942,000.
REA Group senior economist Anne Flaherty.
REA Group senior economist Anne Flaherty said earlier this month that home prices had softened across every capital city except Darwin in June as higher interest rates and cost of living pressures continued to weigh on purchasing power.
“The budget may have also contributed to more cautious decision making among both owner occupying buyers and investors,” she said.
“The strongest performing parts of the market continue to be those offering the greatest affordability.”
Ray White SA chief executive Matt Lindblom also said earlier this month that while investors were pulling back, first-home buyers were replacing them.
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