Brisbane and Adelaide set for growth
Brisbane and Adelaide's housing markets are expected to outperform all other capital cities moving into 2014, according to the latest RP Data Quarterly Review.
The report suggests the Sydney and Melbourne markets may slow as affordability constraints begin to dampen these markets after substantial value growth in 2013.
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The report states, “From an investor's perspective, the best opportunities have now probably passed in these two cities and demand from this sector may also slow.
“On the other hand, we would expect a pick-up in demand and value growth in Brisbane and perhaps Adelaide. Following strong value growth in Sydney and Melbourne, these cities are offering healthier levels of affordability and rental yields are more attractive, [consequently] there is improved potential from an investment perspective”.
As value growth switches from the two largest cities to Brisbane and Adelaide, the report predicts nationwide growth will slow.
“Brisbane and Adelaide have a smaller influence than Sydney and Melbourne on the combined capital cities index (due to the larger number of homes in Sydney and Melbourne), so overall value growth in 2014 is likely to be more sustainable than in 2013,” the report said.
The report also indicated strong population growth and positive economic conditions are expected to drive continued growth in home values, while a rise in unemployment may act to soften the market.
