SA Will Adelaide perform from late 2015/2016..will it be a goer?

I know enough to know not to invest in Adelaide, I have eyes in sky
I completely bypassed neighbouring dud State to invest in Sydney, Melb, USA and NZ which all experienced growth during this period. Good luck with Adelaide.

Over and Out, I let you guys try to work it out, let me know when the BIG BOOM happens. hehe.

 

MTR...think we have moved passed that thread...this is now about the whole Adelaide. I own a place in Elizabeth..I am not convinced about that part of Adelaide. However, there are parts which are only 10 klms...which you can buy for under $300k. These areas offer opportunities.

 

Good thing nobody here has suggested that then.

Having the highest unemployment rate in the country doesn't come about from the employment trends of one or two firms.

It is myopic to suggest that employment doesn't have an impact on the real estate market.

 

Yet is has been. There is this assumption that Holden is integral to the SA economy and it will never recover.

You also wrongly assume I was having a go at you. I was agreeing that there the SA economy is far more than just Holden and BHP, yet thats all a lot of people seem to see and cite as reasons.

 

Quick question.....isn't investing about looking at what you can pick up a great price now...instead when unemployment drops? By the time employment heads down...the market has moved up..and the bargains have disappeared....

The classic point I am making here is the parallel to the Qld market....unemployment was higher last year under the libs...now there is strong evidence unemployment is dropping and quickly now in Qld. It is second only to NSW for job creation according to the ABS. Last year....you could have bought on the Northside 25 klms out for 280-320...now they are 340-400k.

You have to look at the underlying trend....the Feds are keen to keep SA funded and thus reduce unemployment. My thoughts...but I could be wrong...haven't been to far wrong so far.

 

@sash, agreed the opportune time is when the indicators are at their worst, so my best guess for a good buying opp would be late 2016 - early 2017. I think SA unemployment is heading higher yet.

 

It's great what you are doing. Just don't dismiss what others are doing. Plenty of ways to make money in all markets.

Not all of us have millions to invest. Some of us need to play in lower socio economic areas, where as a percentage of return, it stacks up nicely.

 

this is a tricky one. It depends on opportunity cost, amongst other factors. There could very well be more than one similar market that is underperforming [ to the same relative degree] and set for an similar % expansion phase- and you might have only enough money to invest in one market.

 

Excellent, the grown ups can talk now

 

Holland park is heading towards zillmere way..off loading it in 6-8 weeks... re invest in other growing market.

 

I don't recall that being a suburb of Adelaide?

 

That's good.

I was reply to sash's post!

 

If it is a house I think you are selling short...

 

yes it is a house!!

i think you are right! anyway lets wait and watch.. see how it pans out!

 

driver is it is a capital city in 'straya

 

Interesting:
"In Adelaide the median house price grew by 3.3 per cent and the median unit price by 0.6 per cent.

Brisbane median house prices rose 1.9 per cent, while units dropped 3.2 per cent."

http://www.smartpropertyinvestment.com.au/news/14412-bush-capital-posts-surprise-performance

 

ps. SA does have preferential migration status

 

Thats sort of my thinking, I like to buy when there's plenty of pessimism but lots of opportunities. It's easier to buy well with less competition.
I have a vested interest in Adelaide as we have bought 3 there this year, it only makes up about 15% of our investments with most of our properties in Qld. I have previously discouraged people from buying in some areas in SEQ which I own property in so I think I can provide a relatively balanced view.
I don't know Adelaide particularly well but I know from personal experience that Adelaide has a strong technology, defense and government contract sector. This is made up by numerous small and large companies many of which are highly innovative and capable. Most are low profile or have practically no public profile as they are driven by obtaining government contracts only.
The market generally appears from an outsider fairly to under valued and even more so when you look at prices in the other capitals except Brisbane.
IMO
Positives- low entry prices
- pro development councils
- lower council rates and insurance
- reasonable to excellent yields
- low vacancy rates
Negatives
- low population growth
- low interstate migration
- higher unemployment
- slightly lower wages
The lower population growth is a negative as migration generates jobs. I don't think a boom is likely but growth is and holding costs are very low.
Whether or not my timing is perfect to enter this market I'm not really concerned as it will turn around before any one realises, easier to buy without huge amounts of competition but thats just my take on things.
Its about as low risk as you can get presently but I could be wrong.
Hugh

 

Good balanced view there, Hugh

 

And that's a big part of why I am hesitant of Adelaide. What happens if govt contracts dry up..?
Brisbane used to be like this 10 years back, according to my research... But now does not rely so much on one single industry providing projects to suppliers.