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Adelaide house values post fifth financial year of consecutive growth

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Adelaide house values rose 2.4% over the past financial year, marking the fifth consecutive year in which values have increased according to Core Logic.

Although there has been talk of a slowdown nationwide, combined capital city dwelling values increased by 9.6% over the 2016-17 financial year, which was actually greater than the 8.3% rise over 2015-16.

“Combined capital city dwelling values have now increased over five successive financial years, however prior to these increases there were successive financial years in which values fell (-1.4% in 2010-11 and -3.6% in 2011-12),” wrote Head of Research Cameron Kusher. “Across the individual capital cities the growth story over recent financial years has been vastly different.”

Along with Adelaide, Canberra, Sydney, Melbourne and Brisbane have also posted five consecutive years of value growth.

Over the past financial year, Melbourne house values increased 13.7%, edging out Sydney (12.2%), which had the largest increase in the 2015-16 financial year.

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Brisbane saw a 2% increase in values, slightly less than Adelaide and down from 5.3% the previous year. In Canberra and Hobart, values rose by 9.6% and 6.8% respectively over the 2016-17 financial year.

Meanwhile, post-mining boom Perth and Darwin continue to suffer.

Dwelling values in both cities have fallen for three successive years with Darwin experiencing the worst drop (–7%). It was Darwin’s worst dip in values since the largest annual decline of –12.6% over the 2010-11 financial year.

Perth bounced back a little, with the decline rate slowing from –4.7% in 2015-16 to –1.3% in 2016-17.

Kusher concluded that new macroprudential policies, affordability constraints and higher mortgage rates would lead to a slowdown in the housing market. He expects the 2017-18 financial year will record a lower rate of capital gains than the 2016-17 financial year.