The regional property market in South Australia, led by towns near BHP Billiton mining activity, should see price growth in 2012, Real Estate Institute of South Australia (REISA) president Greg Moulton has said following the release of new data by the state government.
Mr Moulton, who is also CEO of Brock Harcourts Adelaide, predicted a surge in prices in towns with a close proximity to BHP Billiton mining activity next year.
“The three towns we call the Iron Triangle; Whyalla, Port Augusta and Port Pirie, will experience stronger growth in 2012,” he said.
“This will be off the back of BHP [Billiton] mining. Whyalla will lead the way and should record the strongest change.
BHP Billiton owns the Olympic Dam mining site, which is located around 550km northwest of Adelaide. The mine is undergoing a major expansion.
Mr Moulton also predicted property prices in other regional towns like Mount Gambier and Riverlands will also rise quickly.
This will be in contrast to 2011, he said. “The lifestyle in regional South Australia is great but over the last year the area has endured some tough times. We are looking to 2012 with renewed optimism.”
The state government released official settlement data for the period of October to December 2011, which showed the median house price for regional SA homes finished the quarter at $251,250. This is 4.7 per cent higher than the winter quarter.
The data however showed an uneven market across SA in 2011. Millicent, a town in the east of the state, recorded an on-quarter change of 16 per cent and a 12 month change of -1.42 per cent. While the normally strong performing eastern town of Naracoorte saw a -25.65 per cent drop over the year.
Port Augusta also demonstrated a significant change, posting a 30.81 per cent drop in prices over 12 months.
The median house price for the Adelaide metropolitan area finished the quarter at $390,000, up $3,000 on the winter quarter, although down by 3.7 per cent when compared to the same time last year.
“This small [quarterly] rise in the median price is important as it shows that prices have leveled out a little and buyers are starting to become more active again,” Mr Moulton said in relation to Adelaide.
“Also, we saw a lot of buyers sign contracts in late 2011 so the stock on market is slowly starting to move and we will see the result of this activity over the coming months.”
“The drop in interest rates has been important for market activity.”