Best areas in South Australia to buy property in 2024

Have you got an eye on the Adelaide or South Australian property market in 2024?

You may be looking to sell your family home, or want to know if now is a good time to offload an investment property you own. No matter the scenario, this article has all the latest stats and expert insights about how the SA and Adelaide property markets performed in 2023, and how they are predicted to perform in 2024.

Let’s start by summarising how the state capital, Adelaide fared over ‘23.

What did the property market look like in Adelaide in 2023?

Overall, according to CoreLogic data capital cities generally recorded stronger

growth conditions relative to regional areas over ‘23. 

Adelaide dwelling values grew +8.8 per cent over the year for a median value of $711,604 - for a gross yield of +3.9 per cent. (Gross yield is a simple way to measure rental income as a percentage of property value, but it doesn't include any expenses managing it). This is an all-time high and has grown 52.3 per cent since the onset of COVID to December 2023. 

Looking at housing types more closely, house price growth was +8.6 per cent for a median dwelling value of $763,606. Units outperformed them slightly, up +10.2 per cent for a median of $484,652. 

The robust market is reflected in Real Estate Institute of South Australia (REISA) data from Dec ‘23 that, ‘the volume of sales across South Australia and metropolitan Adelaide showed significant gains with increases of +14.23 per cent and +15.17 per cent respectively from the previous quarter’.

Let’s now take a look at which suburbs led the charge.

Suburbs with the highest growth

Stand-out suburbs, coincidentally all across Adelaide’s northern suburbs, posted some of the highest value growth over ‘23:

• Playford, which grew +14.3 per cent for a median value of $474,782
• Gawler - Two Wells grew +13.7 per cent for a median value of $590,250
• Salisbury grew +13.2 per cent for a median value of $582,159 
• Tea Tree Gully grew +11.5 per cent for a median value of $700,396

According to the Real Estate Institute of South Australia (REISA) the following regional locations outperformed over ‘23:

• Victor Harbor, just south of Adelaide, grew +26.8 per cent for a median house price of $659,500
• Naracoorte on the Limestone Coast grew +20.8 per cent, for a median house price of $377,500.
• Murray Bridge, east of Adelaide, grew +19.7 per cent for a median house price of $395,000.
• Port Lincoln, on the Eyre Peninsula, grew +20.0 per cent for a median house price of $432,000. 

You may be thinking these figures look promising, but is it worth investing in the state?

Is South Australia still a good state to invest in?

SA has a lot going for it from a property investment perspective, not least the relative affordability of housing. Compare the median unit price in Adelaide ($484,652) vs Sydney ($834,578) and Melbourne ($610,122) - and the ‘more for your money’ argument is obvious and strong. However attractive this may be for interstate buyers, it’s worth noting that price growth since the COVID era has made Adelaide more unaffordable relative to local household incomes. 

As we have seen above, there is also a lot to choose from across the state, from inner-city suburbs with strong demand to regional areas with solid growth potential. This includes regional centres like Victor Harbour and the Barossa, which attract lifestyle buyers.  CoreLogic believes there is also a lot of momentum in the Adelaide housing market after recording dwelling value rises of more than 1 per cent month on month – a trend recorded since May ‘23.

Gross rental yields are also attractive, with regional markets at 5.0 per cent, and Adelaide 3.9 per cent. House rents grew +7.3 per cent in Adelaide over ‘23, with unit rents up +9.4 per cent over that timeframe. 

The SA economy is also robust, supported by key industries such as manufacturing, agriculture, mining and tourism - which all provide a solid foundation for an active and growing property market. And it’s not just wine that draws visitors - culture is also on the menu. An example of this is WOMADelaide - a four-day festival of music, arts and dance in Adelaide's Botanic Park that draws people from across the country.

Let’s now look at what the experts think about the year ahead for Adelaide real estate.

Looking ahead: how are Adelaide property prices expected to change in 2024?

There are a number of factors that are likely to influence how the Adelaide property market performs in 2024:

• Interest rate movements could either dampen buyer demand (rise) or spur on further growth (hold or drop). Experts believe the RBA's decision to hold rates in February (cash rate at 4.35%) suggests they might be nearing the peak.
• A shortage of new dwellings could push house prices even further as buyers outbid each other for a small pool of listings.
• Population growth, in the form of International and interstate migration, could also fuel demand for property across the state. 
• Affordability constraints could become a factor in the SA market. If property prices continue to rise at the same rate as the last 12 months - growth could slow and dampen buyer demand. This is against a backdrop of a cost of living crisis, with high food prices and rents that are climbing fast.

Projections from industry insiders vary, but overall Adelaide property prices are forecast to rise in 2024:

• NAB is optimistic for growth in the Adelaide market, predicting a rise of +6.2 per cent.
• Westpac predicts a more moderate rise of +4 per cent for Adelaide property.
• CBA is the most pessimistic forecaster, believing values will grow only +1 per cent over this year. 
• PropTrack estimates strong growth, with an increase in the range of +4 per cent to +7 per cent.

Like any market, you need to look at a combination of factors when analysing Adelaide property – including population, economic growth, affordability, rental yield and capital growth.