Q3 2019 Key Market Indicators – South Australia
South Australia the land of opportunity
South Australia (SA) continues to hold opportunities for first home buyers, with the number of first home buyer loans increasing by 5.6% in the 12 months to the March quarter of 2019. This is in stark contrast to the Australian average, which declined by -11.6% during the same period, earning SA a bronze award nationally for the most improved number of first home buyer loans in the PRD Q3 2019 Key Market Indicator Awards. This is the second time SA has won the bronze award nationally for the category in the PRD Key Market Indicator Awards Series. It won the bronze medal in the same category in Q2 2019, with 9.4% growth in the 12 months to the December quarter of 2018.
Home loan affordability increased by 0.8% in the 12 months to the March quarter of 2019, with a reading of 37.1 index points. This is positive news for local home buyers in SA, however comparatively across all states this may raise concerns, as this growth is much lower than the Australian average of 3.4% over the same period. SA has historically recorded higher home loan affordability growth than New South Wales (NSW) and Victoria (VIC), however now these states outperform SA, recording growth of 3.3% and 5.1% respectively.
SA experienced a boom in nett migration in the 12 months to the December quarter of 2018, recording exponential growth of 262.9%. This equates to 987 people, which may seem very small compared with NSW (11,788), VIC (19,351), and Queensland (11,927), however, considering the low level of nett migration SA has had in the past, this is a significant increase. Interestingly, dwelling approvals declined by -21.7% in the 12 months to the June quarter of 2019, which suggests there is a dissonance between population growth and housing supply. This provides opportunities for developers, especially those with unique design offerings.
The PRD Q3 2019 Key Market Indicators provide a quick snapshot of the current state of the market in Australia from both an economic and property perspective. The Indicators cover both national and state level data, comprising of:
- Number of loans to first home buyers
- Home loan affordability index
- Number of dwelling approvals
- Consumer sentiment index
- Standard variable loan
- Consumer price inflation index
- Unemployment rate
- Weekly family income
- Nett migration