Looking for the next property hotspot? If so, you may be wondering if Adelaide is still teaming with opportunities for eager property investors.
In this post we look at the facts of investing in Adelaide in 2023 and compare it to other capital cities including Sydney, Melbourne and Perth. You’ll see:
- How Adelaide properties values performed last quarter
- What the rental yield is for Adelaide properties
- The average total return for a property in Adelaide
Adelaide has recorded record high capital gain last quarter
Adelaide is such an appealing destination for investors, and has gotten a lot of attention in the last few months. Last quarter, it outperformed all other capitals with it’s rate of capital gain.
| City | Quarterly capital gain |
| Sydney | 2.5% |
| Melbourne | 1.3% |
| Brisbane | 3.9% |
| Adelaide | 4.3% |
| Perth | 3.6% |
| Hobart | -0.2% |
| Darwin | 1.3% |
| Canberra | 0.4% |
According to analysts from CoreLogic, Adelaide dwelling values have reached a record high which has spurred this growth in such a short period of time, and since bottoming out in 2022, dwelling values have since risen 6.3%
Adelaide has one of the lowest vacancy rates at just 0.3% – there is high demand for rentals
Gross rental yield in Adelaide compared to Sydney and Melbourne
Rental growth slowed in the last quarter as housing values increased, which has seen rental yields decrease overall.
This is what makes Adelaide a superstar in the gross rental yield category. Adelaide has outperformed Sydney, Melbourne and Canberra for rental yields and it’s looking to keep increasing.
| City | Gross yield |
| Sydney | 3.0% |
| Melbourne | 3.4% |
| Brisbane | 4.0% |
| Adelaide | 3.9% |
| Perth | 4.7% |
| Hobart | 4.1% |
| Darwin | 6.6% |
| Canberra | 3.9% |
Adelaide has one of the lowest vacancy rates at just 0.3% so the demand for rentals in this booming capital will most likely increase this gross yield more moving into the quarter.
The total return of an Adelaide property compared to Perth
Although we’d all love to experience the 10.4% total return of investing in property in Sydney, the barriers to owning one of those homes are too high for many investors.
This is why many investors will look for the lowest medium value areas with the highest total return, and although Adelaide isn’t the strongest performer, it’s still a great location that will deliver a high return for many investors.
| City | Total return |
| Sydney | 10.4% |
| Melbourne | 4.7% |
| Brisbane | 9.5% |
| Adelaide | 9% |
| Perth | 13.9% |
| Hobart | -3.0% |
| Darwin | 3.8% |
| Canberra | 0.9% |
However, if you’re considering Adelaide as an investment destination, consider this:
– The total return for properties in Adelaide expect to reach 9.0% and the median value of properties is $691,591
– Compare this to Perth where the total return is 13.9% and the median value of properties is $618,363.
In Perth, you can spend less on an investment property and you’ll see a higher total return in the long run.
The verdict
As always, whether or not you want to invest in Adelaide depends on your personal situation and your financial strategy and goals.
If you can find a property with a low purchase price in an area with a high rental yield then why not?
If you are considering more factors and think the housing prices will increase too much then we are here to help. Book in a free strategy session with our team to see if Adelaide is right for you.