Q4 2017 PRD Key Market Indicators - South Australia
Believe it or not… South Australia (SA), once widely known for its higher affordability (when compared to New South Wales, Victoria and Queensland), is becoming unaffordable. In the space of 3 months – between March and June 2017 quarters – home affordability growth went from positive to negative; as did the number of first home buyer loan growth.
The PRDnationwide Q4 2017 Key Economic Indicators provide consumers with a quick snapshot of the current state of affairs from an economic and property perspective. The PRDnationwide Key Economic Indicators cover both national and state level data, comprising of:
- Number of first home buyer loans
- 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
SA, once widely known for its higher affordability (when compared to New South Wales, Victoria and Queensland), is becoming unaffordable. In the March 2017 quarter, affordability grew by 4.7%, however in the June 2017 quarter, affordability only grew by 0.5% - which is a significant decline over such a short period of time. That said, the SA affordability index (37.3) remains above the Australian average of 31.8 index points, suggesting SA still holds its place as an attractive option for interstate investors.
Increasing unaffordability is further confirmed through a decrease in first home buyer loan approvals, declining by 5.0% over the past 12 months (to June 2017). This is in contrast with March 2017 figures, which showed a 3.3% growth.
Nett migration into SA has increased by 44.3% over the past 12 months (to March 2017), which suggests a higher demand for properties. There is growth in dwelling approvals, of 19.0% over the past 12 months (to September 2017), however this is not on par with increasing migration and may result in an undersupply of high quality stock – hence potentially increasing property prices even further.
That said, SA has lead the way in decreasing unemployment rate over the past 12 months (to October 2017), by 10.8%. SA has also lead in median weekly income, increasing by 3.7% over the past 12 months (to June 2017), to $1,553 per week. This suggests potentially higher disposable income for South Australians, which should assist in tackling increasing unaffordability.
For a closer
look at the PRDnationwide Q4 2017 Key Economic Indicators visit PRD.com.au/research-hub