Adelaide house prices soaring as buyers look to move from COVID-hit Sydney and Melbourne

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Adelaide’s house prices are continuing to hit record levels, new figures show, with fewer homes for sale and outside investors helping drive growth.

Data from market analysis firm CoreLogic shows Adelaide house prices rose 17.9 per cent in the past year, and 5.3 per cent in the past quarter.

“It’s a crazy market, we’ve never seen it before,” buyer’s advocate Matt O’Donoghue said.

“Can it sustain itself? Who knows?”

The growth was part of a broader national trend, with other state capitals recording even bigger rises.

Adelaide’s growth was still less than Hobart (24.5 per cent), Canberra (22.5 per cent), Sydney (20.9 per cent), Darwin (22 per cent) and Brisbane (18.3 per cent).

CoreLogic’s research director, Tim Lawless, said the past 12 months were the fastest year of housing price growth since 1989.

“Through the late 1980s, the annual pace of national home value appreciation was as high as 31 per cent, so the market isn’t quite in unprecedented territory,” he said.

“[But] the annual growth rate at the moment is … 3.6 times higher than the 30-year average rate of annual growth.”

Property in Adelaide has traditionally lagged behind the larger capitals, but some of the recent growth is driven by interstate and outside investors, including those in the COVID-ravaged eastern states.

“Probably one out of five would be going to someone interstate but a lot of the interstate interest is from people looking to relocate, which you can imagine, if you were in Sydney or Melbourne at the moment, you could probably understand,” agent Darcy Harcourt said.

Mr Harcourt said the growth was unprecedented for Adelaide.

“There are lots of buyers and not enough properties to sell them,” he said.

“A lot of people are getting stuck trying to work out what a property is worth.”

That was frustrating for new buyers, including Jason Riggs.

“It sucks, but I guess it’s the reality of what we have at the moment,” he said.

Mr Riggs has been trying to buy since the start of the year, but said the final sale price was often much higher than the asking price.

“I think there’s a bit of a discrepancy between the sale price and what it actually goes for,” he said.

“Being able to find a house that is appropriate — it’s been quite a challenge.”

John McCrostie, the principal of a real estate agency in Unley, said some agents were underquoting and taking advantage of the high levels of demand to push prices even further.

“I’m seeing agents and vendors putting prices on properties that are deceptive, dishonest,” he said.

“What is the real estate industry doing about it? Not a lot that I can see.”

By Eric Tlozek (Original ABC Article)