On the rental front, the average time-on-market to rent a property is approximately 4 weeks and the vacancy rate is currently sitting at around 3.3%, just a margin higher than around the same time last year. With the vacancy rate above 3%, the market hasn’t been tight enough to drive rental rates up, however we have been lucky enough to maintain a solid, stable rental return for our clients. While these figures would be considered fairly typical for the current quarter, as we approach spring and summer, we should see the enquiry levels pick up and the vacancy rate fall.
The promising news is that sales has really picked up over the past 6 months and there is suddenly a buzz amongst the buyers. Stock across the board is still relatively low, however this is to be expected at this time of year, and as we enter spring, there seems to be an excitement that Adelaide has been lacking for too long. Sean Bennett, Mayo’s Sales Manager, has experienced this keen energy and competitive edge first hand.
“I have literally had properties flying off the shelf in recent weeks. The results we have been achieving for nearly every property have exceeded my expectations (and the vendors) and it seems that there is a sudden urge to buy. The auction clearance rate at Mayo’s over the past few months have been 100% and the crowds on the day have been huge. I took a property to auction in St Peters a few weeks ago and we had 21 registered bidders! And similarly, at regular open inspections I have been handing out multiple ‘Offer Letters’ as a matter of course. Many publications and articles have reflected the same trend and records show that Adelaide is performing very well nationally.”
While there is never any guarantee about how this will translate in the market going forward, the general feeling amongst sales agents in Adelaide is one of great anticipation.
There is much speculation that interest rates may be set to rise a little in the foreseeable future, however capital growth is the most important factor to keep in our sights and a significant cut to the Emergency Services Levy may offer a small reprieve for our landlords in the meantime.