Adelaide’s house price growth outpaced the other capitals in the last quarter, with the city outranking Melbourne as the fourth most expensive city as the eastern states lead the downturn.
New data has shown Adelaide outranked Melbourne as the nation’s fourth most expensive city for houses in the last quarter, as tight supply and strong first home buyer demand shapes the market.
According to Domain’s June Quarter 2026 House Price Report, house prices in the city rose 4.8 per cent to $1.125 million, marking the strongest quarterly increase in almost three years.
Adelaide was also the only capital city to record an acceleration in house price growth, with annual growth rising 16 per cent ($154,905), the highest in two years.
Turner Real Estate Adelaide sales partner, Ben Moncrieff, said the city suffered from a chronic undersupply issue, which combined with strong demand, put upward pressure on prices.
“Adelaide is very much a destination city. People want to live here and the government’s trying its best with land releases and things like that,” he told REB.
“Unfortunately we’re not building homes as fast as people want to occupy them. So as a result of that, what we’re seeing is property prices remaining strong.”
Moncrieff said first home buyers were driving demand, particularly for units and properties under the $1 million price point.
“There’s still a lot of competition from them.”
In addition, he said he was still seeing a lot of downsizers wanting to upgrade to larger family homes, while investors have been more hesitant.
“They’re playing a little bit of a wait-and-see game to find out what best suits their investment strategy and whether that includes property at this stage.
“They’re certainly still there, but they’re probably not in as high numbers as we’re used to seeing because of the changes to legislation.”
When it came to properties over $1 million, Moncrieff said there had been a slight downturn in numbers at inspections, but homes were still selling relatively quickly and for strong prices.
In contrast to houses, Adelaide unit prices declined across the quarter by 2.8 per cent to $628,865, falling from the previous quarter’s record high.
It meant the gap between houses and units widened to a more-than-two-year high, with houses now 79 per cent more expensive.
Despite the figures, Moncrieff said the unit market remained popular because of perceived affordability.
“People can’t necessarily afford to buy a cottage where they once could because those prices are now about $1 million to $1.2 million, $1.4 million.”
“Whereas units provide an opportunity for space, for security, for privacy at an affordable price point.”
According to the data, combined capital house and unit prices fell for the first time across a quarter in more than three years, with Sydney continuing to lead the downturn.
Ultimately, Moncrieff said South Australians should remain optimistic that the Adelaide housing market remained strong and didn’t have any signs of slowing down.
“I know it’s a bit doom and gloom in the eastern states, but for those that are in the market already, they can be confident that they will still get a bit of growth in Adelaide.”
“Because of the desire from buyers to live in South Australia, I’m pretty confident it will remain strong.”
Want to see more stories from trusted news sources?Make Real Estate Business a preferred news source on Google.
