What’s next for South Australia’s property market?
After years of strong growth, changing buyer behaviour and economic conditions are creating new challenges – and opportunities – for the state’s property sector.
After several years of rapid growth and intense competition, South Australia’s property market is entering a more measured phase – one where confidence, adaptability and sound decision-making are becoming increasingly important for businesses across the sector.
Harcourts Premium Group CEO Sunny Singh says changing market conditions are reshaping the way buyers, sellers, investors and property professionals approach transactions, with affordability, borrowing capacity and policy settings all influencing behaviour.
“We are seeing a more cautious and selective market,” Singh says.
Recent auction figures highlight the shift. Cotality recorded an Adelaide clearance rate of 46.4 per cent for the week ending September 20, compared with 82.1 per cent in the corresponding week last year.
Higher interest rates and reduced borrowing capacity are among the factors taking some heat out of the market, while some investors are considering a 6-12-month pause as they assess changes to negative gearing.
Population growth, meanwhile, continues to underpin demand for housing, but Singh says affordability and borrowing costs are influencing when people choose to commit.
For businesses operating in the property sector, the changing environment is creating a different set of challenges – and opportunities.
A market where flexibility matters
The shift in market conditions is also changing the relationship between buyers and sellers.
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After years in which strong competition often resulted in unconditional offers, buyers are now gaining more negotiating room on both price and terms. Singh says more sellers are accepting offers subject to finance, building and pest inspections, or the sale of the buyer’s existing property.
That means the headline price is no longer necessarily the whole story.
“Agents need to provide realistic pricing advice and assess offers on their conditions and likelihood of settlement as well as their headline price,” Singh says.
For property businesses, it puts greater emphasis on judgement, communication and risk management – skills that can become particularly valuable when market momentum slows.
Harcourts Premium Group senior sales agents Thomas Korte and Winston Coxon expect the next 12 to 18 months to be more subdued, with performance likely to vary according to location and property type.
“Sellers will need realistic expectations, buyers will have more negotiating room and developers will need confidence in their costs and end demand,” Korte says.
Housing demand creates opportunities
While the market has become more cautious, underlying demand for housing remains.
South Australia’s population growth, supported in part by overseas migration, is translating into demand for both rental and ownership opportunities.
For the property industry, Singh says the challenge is turning that demand into housing that people can afford.
Government measures supporting eligible first-home buyers and new housing are also influencing the market, while master-planned developments are creating new opportunities for buyers at different price points.
Harcourts Premium Group is currently working with Henley Homes to sell a number of turnkey homes at Riverlea Park in Adelaide’s north.
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Senior sales agent Simon de Wit, who has sold Henley Homes in Adelaide for 15 years, says large-scale developments can help broaden access to new housing.
“Developments like Riverlea create an opportunity for first home buyers to get into the market at a price that is still affordable,” he says.
Confidence is the critical ingredient
For Singh, however, the underlying issue across the property market is confidence.
“Confidence determines whether interest becomes a transaction,” he says.
Consumers need confidence that they can manage their repayments. Investors need clarity around returns and tax settings. Developers need confidence that projects will stack up financially.
That makes the ability to navigate uncertainty increasingly important for property businesses.
As conditions soften, Singh says an agent’s ability to assess risk can be just as important as their ability to negotiate a price.
A conditional offer, for example, can introduce uncertainty for a seller. If finance falls through several weeks after an agreement is reached, valuable campaign momentum can be lost and the seller may have to rebuild buyer interest.
Skilled operators can help manage that risk by understanding a buyer’s circumstances, keeping track of conditions and deadlines and, with the buyer’s consent, liaising with brokers to establish confidence around finance readiness.
Keeping alternative buyers engaged can also give sellers options if a transaction does not proceed.
Ultimately, Singh says the businesses best placed to navigate the next phase will combine strong negotiation skills with clear communication, broad marketing exposure and disciplined follow-through.
“Negotiating a sale is one skill; getting it through to settlement is another.”
Harcourts Premium Group is the proud Major Partner of the South Australian Business Index lunch and networking event. Join us as we count down the top 100 South Australian businesses. This year’s event will be held at the Adelaide Convention Centre on Friday, October 16. Purchase your tickets today!
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