3 minute read
Banking
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Paul Modra Executive Manager Member Value and Distribution Police Credit Union
It goes without saying that 2020 was an unpredictable year. With harsh lockdowns across the country, border closures, and uncertainty as to how the pandemic would affect Australia, it was difficult to predict the performance of the property market.
In South Australia, however, there has been a meteoric rise in property sales and prices, as people return from living interstate, overseas travel has been postponed, and people are looking to purchase their first home or upgrade their current properties.
According to CoreLogic data, last year, property prices in Adelaide rose 5.3% to a median of $460,000. But Adelaide and, indeed, South Australia continue to offer great value compared to other major cities.
Consider the property trends we are seeing in South Australia as we move through 2021.
Hot suburbs
There are always some suburbs that outperform others, and the real estate experts have named their picks they think will outdo the rest this year.
Prospect continues to be named as a suburb to watch. With the upgrade of Prospect Road creating a real buzz, this suburb has many properties full of potential. Also, north of the city, keep your eye on North Adelaide, Sefton Park, Windsor Gardens and Parafield Gardens.
As for the east, Glenunga was top of the list thanks to the planned expansion of Burnside Village and for sitting in the highly sought-after zone for Glenunga International High School. Magill, Norwood, Rose Park and Dulwich also got a mention.
Elsewhere around Adelaide, Aldinga, St Marys, Millswood, Parkside, Henley Beach and Stirling all made the list of suburbs to watch.
Invest, invest, invest
It’s not only the property market that is going gangbusters. The rental market is also proving extremely popular. In SA is a big increase in rental demand – the highest in more than a decade.
With demand at a high, now might be a good time to purchase an investment property for the rental market.
This demand could mean that your return on investment is higher, with the price of rentals increasing as much as 5% or more in some council areas such as Burnside, Holdfast Bay, Mitcham, Onkaparinga, Tea Tree Gully, Charles Sturt and Unley.
With residential investment rates hitting an all-time low (under 2% if you consider the Better Fixed Residential Investment Loan at Police Credit Union), now is a great time to consider an investment property.
“Rentvesting” – a new trend in which new property owners purchase a property while living at home or themselves renting – could be an option to get your foot into the market. Plus, high rental returns and possible tax deductions often balance out-ofpocket costs. With record low interest rates on offer, purchasing or building your first home or upgrading from your current home and refinancing has never looked better.
Holiday at home
With overseas travel continuing to be off the cards, people are looking to do more in their own backyard. That includes purchasing land to build a holiday home or purchasing an existing holiday home in their area of choice.
Use it for your leisure, rent it out and reap the benefits, or do both. Airbnb is just one business that has allowed many property owners to convert their holiday home into regular income.
Record low interest rates plus grants
With record low interest rates on offer, purchasing or building your first home or upgrading from your current home and refinancing has never looked better. As further incentive, there is a grant available to assist new homeowners with purchasing or constructing a new home.
You might be eligible, as a first-home buyer, for a First Home Owner Grant of up to $15,000 on the purchase or construction of a new residential home in South Australia.
The grant is valid if you are purchasing a new home (market value of $575,000 or less) that has not been previously occupied or sold as a place of residence. This includes a substantially renovated home.
There are several conditions and requirements that apply (refer to www. revenuesa.sa.gov.au for further information and to apply).
If building is of interest, many of Police Credit Union’s leading home loans can be used for construction purposes with progressive draw downs and interest-only payments applicable during the project as well as $0 monthly and $0 annual fees.
