Adelaide’s 10.5% Growth Defies National Property Downturn

Adelaide delivered 10.5% annual home value growth while Sydney and Melbourne fell, as supply shortages and broad-based buyer demand set South Australia apart.

When Sydney and Melbourne home values are falling and auction clearance rates are languishing well below 50% across most capitals, South Australia stands as a notable outlier. Australian Broker has reported on what is keeping Adelaide's property market growing — and the story offers useful context for both local buyers and investors looking beyond the major eastern markets.

According to Cotality data cited by Australian Broker, property values across the Adelaide area grew 10.5% in the year to July 2026. Even in regional South Australia, the market has held up well, with values rising 2.1% in the most recent quarter. By comparison, Sydney home values declined 2% over the same period and Melbourne fell 2.8%. Nationally, property prices dropped 0.7% in July — the largest single monthly decline since December 2022.

South Australia, alongside Western Australia, stands as one of only two states where regional property prices also rose in recent months. The contrast with the broader national picture is stark.

What Is Driving Adelaide's Resilience

Multiple brokers operating in Adelaide have identified the same underlying story: the market is supply-constrained, and demand is unusually broad and diversified across buyer types.

Joey Delis, a Loan Market broker in Adelaide, told Australian Broker that the core dynamic is a land and infrastructure shortage. "It's purely a supply issue in South Australia that's keeping the price demand high. We just don't have enough land or enough infrastructure in certain areas, like the north and the south, to be able to create more allotments of land fast enough for people to buy them," Delis said.

Bryan Ong, founder and director of Rise High Investor and Financial Solutions in Adelaide, described a market that continues to attract buyers who have been priced out of eastern city markets. "You need significantly more borrowing capacity and serviceability to purchase property in the Eastern States. You can still get $600,000, $650,000, $700,000 properties in South Australia. And they're investment grade," Ong said.

Belinda Sugars, franchise owner and broker at Mortgage Choice Parkside, said South Australia has simply been catching up after years of underperformance relative to the eastern states. "South Australia is as steady as she goes; it's a solid market. And South Australia has been doing a little bit of a catch-up in the last couple of years, matching what other states have done. So we've had quite a bit of room to move," she told Australian Broker.

A robust employment base — including defence infrastructure projects generating local jobs — is adding to the demand picture. State government programs are also drawing more purchasers into a market that already has limited stock.

One program worth knowing about for prospective buyers is HomeStart, a South Australian government-owned home finance organisation. HomeStart offers loans with a 2% deposit requirement — significantly lower than the 5% deposit required under the national Home Guarantee Scheme — for eligible buyers who take up residence in South Australia. For buyers who meet the criteria, this provides access to the property ladder at a materially reduced upfront cost compared with standard lending requirements.

Blake Buchanan, general manager at Specialist Finance Group, said his aggregator had recently added HomeStart to its lending panel and that South Australia had become one of the fastest-growing regions in its network. He described the demand picture clearly: "Rather than relying on one particular type of buyer, you've got first-time homebuyers trying to enter, established South Australians moving through the market and investors competing for stock. When you combine that breadth of demand with constrained supply, you start to understand why South Australia has been such a resilient market."

Outlook and What It Means for Buyers and Investors

Brokers on the ground are measured rather than bullish about the near-term outlook. Scott Bament, a Mortgage Choice broker in Morphett Vale, told Australian Broker he expects growth to continue but at a more moderate pace: "I think we'll still see a little bit of growth, but it's definitely going to ease off and go back to sleep for a little while."

Ong similarly projects slower but continued growth. "I think South Australia's market will always keep growing, just a bit more slowly. Basically, we're not going to see the growth that we've seen over the past five years. But I don't ever really think that our property market will substantially go backwards. I'm still pretty optimistic," he said.

The key takeaway for buyers is that the relative affordability advantage South Australia holds over Sydney and Melbourne is real, but it is narrowing. The window where investment-grade properties in well-located parts of Adelaide are available at $600,000 to $700,000 may not remain open indefinitely if supply constraints persist and interstate migration continues.

For first home buyers considering the South Australian market, understanding what schemes are available to you and what you can realistically borrow is the critical first step. Our first home buyer guide outlines the key schemes and what lenders require. Our borrowing power calculator can give you a quick read on your capacity before you engage with an agent or make an offer.

Investors assessing the South Australian opportunity should weigh the supply-demand dynamics carefully against current lending conditions. See our investor home loans guide for context on what lenders are currently pricing for investment purposes and what serviceability criteria apply.

South Australia is an outlier in a market that is broadly softening — but it is not immune to higher interest rates, stretched affordability, or the broader shift in buyer sentiment that is playing out nationally.

Australian Broker spoke with brokers across Adelaide about the dynamics driving the state's continued growth.