South Australia’s median house price has taken a hit for a second consecutive month, after values dropped in June for the first time since January 2023.
According to REA Group’s August Home Price Index, Adelaide’s median home value dropped 0.5 per cent last month – down 0.7 per cent from its peak in May.
Adelaide’s median combined dwelling value – that of both houses and units – is $935,000.
Houses also took a hit – down 0.6 per cent for the month to a $1.011m median.
Adelaide unit prices also dropped 0.4 per cent to a $700,000 median.
Despite this, values are still up over the past 12 months, with Adelaide’s combined dwelling price sitting 10 per cent or $90,000 higher than the $845,000 reported this time last year, its median house price 9.7 per cent or $94,500 higher than last year, and its unit price 11.5 per cent or $75,800 more than last July.
Adelaide’s median home values have dropped for the second consecutive month. Picture: Brenton Edwards
Report author, REA Group senior economist Anne Flaherty said Adelaide had been a popular market for investors, and a decrease in new landlords thanks to announced budget changes may have had a large impact.
“I think Adelaide is quite interesting, in the sense that it has been such an outperformer,” she said.
“To see it switch from a market where prices have been accelerating quite rapidly to a market where prices have been falling really indicates a big change for the city.”
![](data:image/svg+xml,%3Csvg xmlns="http://www.w3.org/2000/svg" viewBox="0 0 1280 720"%3E%3C/svg%3E)
PropTrack senior economist Anne Flaherty
She said national prices had been consistently declining over the past few months due to a domino effect of interest rate hikes, the new federal budget and reduced competition.
“The budget changes have been a factor,” she said.
“It is pretty reasonable to assume we’ve seen an overall decrease in buyer demand from a decrease in investor demand.”
Ms Flaherty said units had been outpacing houses for growth in most markets due to their greater affordability, while first home buyers and upsizers were holding off to see how far the market could dip.
“I do think it’s going to continue to become even more of a buyers market,” she said.
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Homes in regional SA, however continued their value climb.
Regional SA’s median combined dwelling value rose 0.6 per cent over the last month to a new peak of $527,000.
Houses are also up – 0.6 per cent for the month to a $534,000 median, and units sit 0.7 per cent higher than last month at $477,000.
Their 12-month growth is also solid, with regional SA’s combined dwelling price sitting 12.7 per cent or $65,000 higher than was reported this time last year; its median house price also 12.7 per cent or $57,900 higher than last year, and its unit price 13.7 per cent or $59,600 more than last July.
![Supplied Editorial James Packham of Harcourts. Picture: Supplied](data:image/svg+xml,%3Csvg xmlns="http://www.w3.org/2000/svg" viewBox="0 0 768 1024"%3E%3C/svg%3E)
Harcourts’ James Packham. Picture: Supplied
Harcourts Packham Property managing director James Packham said buyer sentiment was shifting.
“Buyers are hearing national media headlines that prices are softening and they’re demanding discounts on advertised prices,” he said.
“Sellers value what they own.
“We’re in a stable economy and they don’t agree that they need to concede anything on price.
“The clearance rate at auction has been in free fall for the last few months from a high of 94 per cent clearance rate down to the mid-30s.
“Now, that’s not properties selling for more or selling for less.
“That’s properties failing to transact and that is a sign of that Mexican standoff where the buyers are not prepared to concede to the price the sellers want and the sellers are not prepared to concede to the price that the buyers want to pay.
“Now, in my experience, all of these things pass over like a wave because people that want to buy a property are still going to need to buy and people that want to sell a property are still going to need to sell.
“So normally we see a big kickback following a stall in the market because everybody still ultimately wants to transact.”
– with Nicholas Finch
