The resource boom has seen rural SA outperform Adelaide in recent times. While the regional areas continue to perform strongly, Adelaide has now hit back and remains one of the most affordable capital cities in Australia.
The median regional house price in South Australia has continued to soar to $210,000 in the March quarter, according to Residex data.
The Real Estate Institute of South Australia (REISA) has applauded the growth describing it as a healthy correlation to what’s currently happening to prices in metropolitan Adelaide.
The best performers in regional South Australia have again been areas around the Eyre Peninsular such as Port Augusta and Port Pirie – both have achieved outstanding growth in the past 12 months.
REISA President Mark Sanderson has attributed the performance of the regional market to strong industry growth, which is fuelling the economy.
"Industries drive employment which drives the need for housing, so demand for regional properties is red hot," he says.
The low cost of property in regional SA is another advantage Sanderson says investors should consider.
"The other advantage is that our regional prices are still very affordable when compared to the metropolitan area. South Australia's country areas are a great place to buy affordable property and be confident of long-term capital growth," he says.
However, the last quarter has also seen the drought worsen around the Murray Darling Basin to the point where severe water restrictions, including an irrigation ban, may still have to be implemented. This would be disastrous for the agriculture and mining industry, as they would both need to comply. In turn, this would have an adverse effect on the performance of regional property prices Adelaide has also had some growth in the last quarter and remains one of Australia’s most affordable cities with a median house price of $308,500. It has grown at a slightly higher rate than regional South Australia, recording growth of 2.90% as opposed to regional growth of 2.82%. With plenty of developments proposed for regional areas of South Australia (some of them already underway) the future of the Adelaide market looks promising.